FTR’s Shippers Conditions Index for September Falls into Negative Territory as Expected

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FTR’s Shippers Conditions Index (SCI) moved back into negative territory, falling three points from August to a -2.4 reading in September.  The August positive reading was not expected to last; and, in September, the slow but steady build in regulatory drag moved the index back into negative territory that will not reach its nadir until late 2017 or early 2018. New regulations are beginning to tighten capacity and, consequently, truck rates are turning upward making shipping costs including spot rates higher.

The Shippers Conditions Index is a compilation of factors affecting the shippers transport environment.  Any reading below zero indicates a less-than-ideal environment for shippers.  Readings below -10 signal conditions for shippers are approaching critical levels, based on available capacity and expected costs.  Details of the factors affecting the September Shippers Conditions Index, along with guest commentary by Paul Newbourne, chief operating officer of Covenant Transport Solution, Collaboration: The new Road to Transportation Efficiency, and FTR’s look at some post-election scenarios impacting trucking conditions are found in the November issue of FTR’s Shippers Update published November 4, 2016.

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Click here to view the latest release and an interactive graph of the SCI>

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Eric Starks, Chairman and CEO at FTR, commented, “While the Shippers Condition Index moved into negative territory, we are not seeing any material changes to shippers at the moment. There is still plenty of truck & rail capacity, and rates remain stable. We don’t anticipate any ‘real’ changes for shippers until late in Q1 or Q2 of next year. The shipping season is winding down, and demand for shipping will be in a seasonally soft period for the next few months. One item that we are keenly focused on is the implementation of Electronic Logging Devices by the trucking industry over the next year. If regulatory changes delay this, then it would not tighten truck capacity in the second half of next year as is currently anticipated. Only time will tell.”

For more than two decades, FTR has been the thought leader in freight transportation forecasting in North America.  The company’s national award-winning forecasters collect and analyze all data likely to impact freight movement, issuing consistently reliable reports for trucking, rail, and intermodal transportation, as well as providing demand analysis for commercial vehicle and railcar.  FTR’s forecasting and specially designed reports have resulted in advanced planning and cost-savings for companies throughout the transportation sector.