FTR Shippers Condition Index sinks in May

FTR Associates’ Shippers Condition Index (SCI) as reported in the firm’s May Shippers Update fell to a reading of –11.4, reflecting tightening capacity and accelerating transport costs. The SCI sums up all market influences that affect shippers; a reading above zero suggests a favorable shipping environment, while a reading below zero is unfavorable.

Larry Gross, senior consultant for FTR, said, “The recent sharp deterioration in the SCI reflects the twin pressures of tightening capacity and rising fuel surcharges. Looking ahead, with the slower recent growth in the economy, we are expecting the SCI to begin to stabilize and would not be surprised to even see some modest improvement in the next few months. Such improvement would not, however, change our basic outlook for a difficult environment for shippers through the end of this year and well beyond.”

The May Shippers Update includes commentary discussing whether the increase in Class 8 orders will ultimately ease tight shipping capacity.