BLOOMINGTON, Ind. – Trucking conditions in the U.S. improved in April, returning to a mid-positive range, according to the latest Trucking Conditions Index from FTR.
The index read 7.03, up more than four points from March. FTR is projecting trucking industry conditions to improve despite year-over-year weakness in contract pricing. It says freight demand is improving and capacity is tightening.
The first quarter of 2017 registered the second strongest freight growth of the current recovery, FTR notes, with modest growth expected over the remainder of the year.
“Overall, our expectation of improvements in freight demand for 2017 are coming to fruition,” said Jonathan Starks, chief operating officer, FTR.
“However, we are seeing a significant difference between the contract carriers, specifically those in more dedicated routes, and the spot market. Contract markets are showing limited load growth and weak pricing, but spot market indicators are telling a very different story. Data from Trans4Cast.com shows that spot market load activity in early June was up more than 50% compared to the same time last year. Importantly, truck capacity in the spot market is down during that same time. This has led to significant rate increases for spot moves, with the average rate up more than 10% on a year-over-year basis. We typically see spot markets move prior to the contract arena, so we would expect to see stronger contract pricing negotiations as we finish 2017 and head into 2018. The market is gaining strength, and conditions for carriers are showing significant improvements.”