FTR Trucking Conditions Index down in February from January

By Jeff Berman, Group News Editor
April 04, 2012 - LM Editorial

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

Carload volumes were up 2.8 percent at 304,276, and intermodal volume for the week ending August 16 was up 5.4 percent at 270,316 containers and trailers.

Even though this data can be viewed as “old” in the sense that there is not a whole lot new to report about the port labor talks, it does a good job of looking into the mindset of shippers as talks continue.

Company officials said this service will be provided without any type of additional cost for customer shipments traveling from Ohio, Michigan, and Indiana, with expedited services available to customers outside of this area.

FTR says both spot rates and contract rates are heading up in a full capacity environment and with the fall shipping season rapidly approaching, it explained conditions for shippers could further deteriorate.

Read how others are using Business Process Management to achieve ERP success with Microsoft Dynamics AX. Download the free white paper now.

About the Author

Jeff Berman, 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. Contact Jeff Berman.

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