Tight capacity, increasing rates impact shippers in October

FTR October shippers statsBLOOMINGTON, IN – While conditions have moved out of the danger zone, ongoing capacity concerns, and the corresponding rate increases, remain the biggest challenge for shippers, according to a new report by FTR

The Shippers Condition Index (SCI), with a reading of -5.5 at the end of October, suggests the trucking segment remains highly vulnerable to seasonal shortages.

FTR expects the SCI to deteriorate over the next several months especially in light of noticeable increases in costs at carriers – with the exception of fuel – and increased transaction expenses as shippers search harder for capacity to haul their goods. 

 “Of the four key segments that represent the Shippers Conditions Index, fuel is currently the only item with a positive contribution in October,” said Jonathan Starks, FTR’s director of transportation analysis.

“While truck utilization has eased from the level seen last winter, it still remains historically high.”

He said contract rates continue to move steadily higher and spot rates are quite elevated – up 20% year on year in late November.

“Despite fuel prices continuing to drop, the cheer from shippers may be short-lived,” he said. “As the economy looks likely to accelerate in 2015, it could cause capacity to tighten once more, leading to further acceleration in base freight rates.”


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