FTR’s Shipping Conditions Index for October fell to a -11.6 reading reflecting sharply worsening market conditions. In October there was a sudden increase in capacity utilization which, along with a tough rate environment and higher freight demand, resulted in the lowest reading for the SCI in three years. FTR forecasts the SCI beyond October to improve but it is not expected to rise into positive territory until at least late 2022.
“The uncertainty around the COVID-19 pandemic and the potential for pent-up freight demand once the vaccine becomes widely available should help keep shippers conditions under pressure through the next 18 months,” said Todd Tranausky, vice president of rail and intermodal at FTR.
The December issue of FTR’s Shippers Update, published December 7, provides a detailed analysis of the factors affecting the October Shippers Conditions Index and provides the forecast for this index through October of 2021. Additional commentary includes an overview of the significant recovery for the goods transport sector in Q3 which greatly outpaced the broader economy.
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 the industry’s health at a glance.
