Subscribe to our free, weekly email newsletter!


FTR Trucking Conditions Index for January is down slightly from December

By Staff
March 05, 2012

Data released today by freight transportation consultancy FTR Associates showed that conditions impacting the trucking market in its Trucking Conditions Index (TCI) dipped slightly from December to 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, came in at 6.1 in January, which was down slightly from December’s 7.0 and snapped a three-month growth streak.

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.

“The spike in the price of diesel due to Mideast tensions is one factor that has pulled the TCI down recently and downside pressure will continue until the price stabilizes,” said Larry Gross, FTR senior consultant, in a statement. “However, barring a significant economic slowdown from an external factor such as an actual Mideast confrontation, the fundamentals for the trucking industry are expected to continue to strengthen throughout the year, and we could well see a surprise on the upside if important sectors such as automotive and even housing continue to improve.”

While fuel is acting as a wildcard at the moment, carriers are still in a favorable position for rates, due to 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.

Gross recently noted 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 result.

FTR added that even with a slower than expected start with the January TCI it expects a slow climb to positive territory throughout 2012, “with volumes and profits sufficient for investment for growth by year’s end.” 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.

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

Read how others are using Business Process Modeling to implement Microsoft Dynamics AX with reduced risk.

While diesel prices have largely been out of the spotlight in 2014, freight transportation and logistics stakeholders always need to keep a close eye on what prices are doing, as it has a significant impact on transportation budgets and forecasting.

Railroad service issues and rates, which many rail shippers deem as unreasonable, are front and center in a piece of legislation to be introduced soon by Senators Jay Rockefeller (D-WV) and John Thune (R-SD), chairman and ranking member of the Senate Committee on Commerce Science and Transportation.

The Nicaragua Canal will be three times the length of the Panama Canal, crossing the major Lago de Nicaragua, one of the largest freshwater reservoirs in the region.

FTR and Internet Truckstop said that this alliance will provide shippers and carriers with myriad benefits, including market analysis and specificity for contract and spot freight segments by region and trailer type.

Article Topics

News · Trucking · FTR Associates · All topics

Comments

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


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA