Not Getting Any Better for Shippers Any Time Soon

March 13, 2012
The latest report on shipper conditions indicates that the market continues to be unfavorable, with not much hope for a near-term turnaround.

It’s not getting any easier out there in the freight markets for shippers, based on the latest Shippers Condition Index (SCI) report from FTR Associates. The index for January 2012 dropped 0.2 points to a reading of -4.8, reflecting a slow acceleration of freight growth that will continue to drive the index gradually lower over the remainder of the year.

The SCI sums up all market influences that affect shippers; a reading above zero suggests a favorable shipping environment, while a reading below zero is unfavorable.

Truck utilization will remain relatively strong until new Hours of Service regulations are implemented in 2013, at which time capacity is expected to tighten significantly if the current rate of freight growth continues.

“Although our forecast for the economy remains conservative, we anticipate that freight growth will exceed the growth rate in GDP,” predicts Larry Gross, senior consultant for FTR. “This will continue to keep transport capacity tight throughout the forecast period, resulting in ongoing upward rate pressure.”

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