Subscribe to our free, weekly email newsletter!


FTR Trucking Conditions Index down in February from January

By Jeff Berman, Group News Editor
April 04, 2012

Freight transportation consultancy FTR Associates reported this week that conditions impacting the trucking market in its Trucking Conditions Index (TCI) were down slightly in February from January. 

The TCI, which reflects tightening conditions for hauling capacity and is comprised of various metrics, including capacity, fuel, bankruptcies, cost of capital, and freight, was 5.9 in February, down from January’s 6.1 and December’s 7.0. January marked the end of a three-month growth streak for the TCI.

According to FTR, a TCI reading above zero represents an adequate trucking environment, with readings above ten indicating that volumes, prices, and margin are in a good range for carriers.

“February is normally the softest month of the year in terms of trucking demand.  Reasonably favorable conditions for truckers during the winter slack season bode well for later in the year, as demand increases seasonally to more normal levels,” said Larry Gross, FTR senior consultant, in a statement. “We expect pricing power to remain squarely on the side of the carrier in 2012.”

FTR officials said that the coming months are expected to show sequential strength through the remainder of 2012, with trucking freight volumes expected to grow at rates of 4 percent or better, which in turn will put pressure on available capacity while maintaining pricing power.

As LM has reported, there are multiple factors at play which are positive for carriers, including high fuel prices fairly tight capacity, a limited driver pool, and regulations like CSA and HOS (set to kick in next year) working in tandem to create an environment in which many shippers are chasing the same carriers for freight.

In a previous interview, Gross said that even with mild economic growth, overall conditions are likely to be tempered for shippers, adding that if the recent spate of good economic news translates into more robust economic growth, capacity would tighten significantly and greater upward pressure on freight rates will come as a result.

The firm also said that the rebounding U.S. economy is expected to produce at least a 3.9 percent gain in truck freight that would top overall GDP performance.

About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Shippers and other ocean cargo carrier stakeholders should be cheering the announcement made today by The U.S. Coast Guard, as it formally notified the International Maritime Organization through a Declaration of Equivalency that the United States position on SOLAS is that there are multiple methods to submit the combined cargo and container weight (Verified Gross Mass or VGM).

The proposed $4.8 billion acquisition of TNT Express N.V. by FedEx took a major step closer to becoming official today, with the company and TNT announcing today that they have received unconditional approval of the offer from the Ministry of Commerce People’s Republic of China (MOCFCOM).

March shipments at 798,180 trailed February by 12 percent and were down 19 percent annually. For the entire first quarter, shipments were relatively flat annually, rising 0.27 percent to 2,587,988.

OCEMA says it has placed a priority on working with other stakeholders to find operational solutions that will help U.S. exporters, carriers, and marine terminals prepare for the implementation of the SOLAS Verified Gross Mass (VGM) rule.

The first quarter is typically the slowest period of freight demand for LTL carriers. With a few notable exceptions, that was reflected in first quarter earnings reports of the major publicly held LTL carriers.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2016 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA