A measure of business conditions for the trucking industry has continued its downward trend from the boom days of 2018, falling into negative territory in March for the first time in "several years," according to the freight industry tracking firm FTR.
FTR's Trucking Conditions Index (TCI) for March fell to -1.18, its first negative reading in years, the Bloomington, Ind.-based freight transportation forecasting and consulting firm said today.
In FTR's index, positive numbers mean strong conditions for carriers—and high freight prices for shippers—while a zero reading indicates that truck supply and demand are roughly in balance.The index's negative rating for March comes just over a year since it hit a record high of 15.41 in February 2018.
The index has been falling ever since, with carriers seeing a softening environment as they come under pressure from a continued easing of freight rates and a sluggish outlook for demand, FTR said. The weakness in the truckload (TL) market is mostly on short-term spot rates, but the contract rate outlook also has turned slightly negative, as indicators such as active truck utilization and the TL rate outlook both continued to ease in March.
"The trucking industry has essentially returned to neutral conditions as deterioration in most market factors are offsetting continued solid, but not robust, freight demand," Avery Vise, FTR's vice president of trucking, said in a release. "We generally expect this balance to continue into 2020, but TCI readings could turn positive or negative month to month based on relatively minor shifts in demand, utilization, rates, or costs."
FTR's report follows a similar assessment last week from the analyst and forecasting firm ACT Research, which found that demand for freight capacity is continuing to drop, thanks to hot truck sales pumping new capacity into the market, even as turbulent trade tariffs add uncertainty to forecasters' models.