Moving into 2014, the environment for shippers should remain negative, with less favorable conditions prevailing, according to research and forecasting firm FTR Associates.
FTR’s Shippers Conditions Index (SCI) improved marginally for the second straight month, but the firm said continued regulatory pressure and slow growth in demand with no additions to capacity should combine to drive the SCI down. October’s reading was -7.5, up 0.4 points from September.
The Shippers Conditions Index is a compilation of factors affecting the shippers transport environment. Any reading below zero indicates a less-than-ideal environment for shippers. Readings below 10 signal that conditions for shippers are approaching critical levels, based on available capacity and expected rates.
“The effects of the continuing rollout of new regulations makes for an unusually challenging forecasting environment, because both the timing and final structure of many proposed regulations are not firmly established. Our forecast, based on the best information we have available at this time, is that regulation will be the principle cause for tighter capacity and higher rates in the coming year,” said Larry Gross, senior consultant.
Details of the factors affecting the Shippers Conditions Index, along with additional commentary discussing the economic recovery and why acceleration still remains possible in 2014, are included in the December issue of FTR’s Shippers Update published Dec. 10, 2013.
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