FTR Shippers Conditions Index improves slightly in December

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FTR Associates on Tuesday, Feb. 14, announced that its Shippers Conditions Index for December edged up roughly 1½ points from the previous month to a reading of -4.6, which still reflects a somewhat adverse environment for shippers. The small improvement reflected a slight easing in demand for transport capacity.

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. FTR said the tight equilibrium between demand and transport capacity will keep the Shippers Conditions Index stable in modestly negative territory until 2013, when it will slip further due to regulatory drag on capacity from the hours-of-service rule implementation.

“FTR’s base case anticipates that conditions will continue to be difficult for the nation’s shippers, even though economic growth is still anticipated to be lackluster,” said Larry Gross, FTR senior consultant. “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.”