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Freight still remains strong in May despite slight decline

July 16, 2021
While FTR Intel’s TCI is forecasted to remain at double-digit positive readings through 2021 and to remain positive through 2022, this outlook depends on only incremental improvement in driver capacity in the near term.

FTR Intel’s Trucking Conditions Index (TCI) eased slightly in May due to a swing in diesel prices. The TCI declined to a reading of 15.72 from the 16.82 reading in April. Stronger freight rates would have pushed the index to a third straight record, but the increase in fuel costs diesel prices, along with slightly weaker capacity utilization, offset those gains.

“Market conditions in the flatbed segment appear to be stabilizing, but we do not have clear signs of the stress in the van markets easing,” Avery Vise, vice president of trucking at FTR, commented. “The solid increase in for-hire trucking's payroll employment during June might be a hint that the market is peaking, but we expect considerable friction to remain in the supply of drivers at least into next year.”

The TCI is forecast to remain at double-digit positive readings through 2021 and to remain positive through 2022. However, this outlook depends on only incremental improvement in driver capacity in the near term.

“However, one of the market stresses has been the unprecedented surge in small new trucking operations, which has added to market disruptions,” Vise added. “With high diesel prices and truck insurance costs, we would expect many of those drivers to return to the security of larger employers once spot rates start falling significantly. This possibility along with the end of generous unemployment benefits represent risks in the outlook.”        

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