FTR Shippers’ Condition Index shows modest sequential improvement

The uneven nature of business trends for shippers appears to be fully intact based on the most recent edition of the Shippers Condition Index (SCI) from freight transportation forecasting firm FTR Associates.

Following a modest decline in September, the SCI in October, which is the most recent month for which data is available, was up 1.1 points to a reading of -3.6, ahead of September’s -4.7. May’s -11.4 was the worst SCI reading of this current economic cycle. A reading above 0 suggests a favorable shipping environment, and FTR describes the SCI as an indicator that sums up all market influences that affect shippers.

FTR explained that that the current environment for shippers through early 2012 is “stable,” with modest rate increases and acceptable available capacity levels. But the firm cautioned that could change quickly in a negative fashion by mid-2012 as the hours-of-service revision takes its course. Various reports indicate that the FMCSA will issue a new revised ruling by the end of this week.

In a recent interview with LM, FTR Senior Analyst Larry Gross said the HOS situation creates a high level of uncertainty for shippers.

“Not only do we not know what is going to emerge from this political meat grinder [regarding HOS] that is in play, with the White House and FMCSA doing their thing, as well as pressure from the Republican side of Congress not to change anything,” said Gross. “The inevitability of it is whatever emerges when the HOS rule comes out later this month, it is certain to be challenged in court.”