Trucking conditions remain ‘solidly favorable’

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The Trucking Conditions Index, produced monthly by FTR Associates, continues to show that conditions for trucking companies in May stayed in a “solidly favorable range,” says FTR. The indexes reading was 12.4, and anything above 10 shows that volumes, prices and margins produce very good conditions for trucking companies.

The reading stems from expectations of rising rates and margins due to tightening capacity conditions, says FTR, who expects the conditions to continue indefinitely “either until the next round of trucking regulations are rolled out that will further tighten capacity or an unexpected recession significantly reduces freight demand,” says FTR’s report.

“The trucking industry has seemingly been stuck in a holding pattern for the last year or so,” says FTR’s Jonathan Starks, director of transportation analysis. “Rates have only moved slightly higher and freight growth, while strong at the end of 2012 and early in 2013, has generally been modest.”

Starks added that supply and demand balance will continue to be shifted in favor of trucking companies and fleets, and, because of these factors, he expects an uptick in rates by the end of the year.