FTR’s Shippers Conditions Index improved marginally in January

FTR’s Shippers Conditions Index (SCI) for January rose marginally from December’s -10.9 to a still significant negative reading of -9.8 for the month.  Overall shipping conditions improved very slightly in January with near-term conditions tough due to rising fuel costs and rates.  FTR forecasts modest improvement in conditions going forward with the SCI expected in a low single-digit negative range through most if not all of 2021.

Todd Tranausky, vice president of rail and intermodal at FTR, commented “It is unlikely that shippers’ conditions will improve much over the balance of the year as additional freight demand underpinned by additional consumer stimulus will keep capacity tight through the end of the year. Higher rates and higher fuel surcharges are also a risk as the economy recovers. This could add negative pressure to the outlook for shippers later in 2021. A big question is how quickly truck driver capacity will return as that will largely dictate the direction of rate pressures not only in trucking but in intermodal as well."

The March issue of FTR’s Shippers Update, published March 5 provides a detailed analysis of the factors affecting the December Shippers Conditions Index and provides the forecast for this index through January of 2022. Additional commentary discusses how risks to FTR forecasts are shifting from freight demand to driver availability.

The Shippers Conditions Index tracks the changes representing four major conditions in the U.S. full-load freight market. These conditions are: freight demand, freight rates, fleet capacity, and fuel price. The individual metrics are combined into a single index that tracks the market conditions that influence the shippers’ freight transport environment. A positive score represents good, optimistic conditions. A negative score represents bad, pessimistic conditions. The index tells you the industry’s health at a glance.