The economic environment for shippers reflects one of those most evenly balanced freight markets in years, according to the latest monthly index of market conditions generated by the industry consulting firm FTR.
Bloomington, Ind.-based FTR's Shippers Conditions Index (SCI) for January reflected a reading of 1.4, which was slightly weaker than December's 1.8 level, but still in positive territory after consistent negative readings over the past two years.
That result mirrored FTR's recent measure of the corresponding Trucking Conditions Index (TCI), which fell to 5.79 in January from 11.44 in December, reflecting a marketwide trend toward lower freight demand and capacity utilization, according to FTR.
FTR forecasts the SCI to remain close to neutral through the first quarter of 2019 and then to rise slowly as the year progresses. However, even as the SCI is expected to peak early in the fourth quarter of this year, shippers' conditions will be only marginally positive as capacity remains tight by historical standards, the firm said.
"While conditions for shippers are forecast to remain neutral to positive over the coming months, it is possible that the duration and extent of flooding in the U.S. Midwest could be a headwind to those improvements, depending on where your freight is moving," Todd Tranausky, vice president of rail and intermodal at FTR, said in a release. "Overall stable fuel prices and more available capacity than was experienced in 2018 will create a relatively calm environment."
FTR calculates its SCI by tracking four major variables in the U.S. full-load freight market, including freight demand, freight rates, fleet capacity, and fuel price. The firm then combines those individual metrics into a single index that measures changes in shippers' freight transport environment. A positive score represents good, optimistic conditions, while a negative score represents bad, pessimistic conditions.