Trucking carriers enjoyed better market conditions in December than they had for a seven-month span, thanks to falling diesel prices and greater freight volume, transportation analysis firm FTR said today.
FTR’s Trucking Conditions Index (TCI) for December rose to 14.45, improving from 10.0 in November, sending it to its highest peak since May. The all-time high was 16.8 just a month earlier, in April 2021. The index tracks changes in five conditions in the U.S. truck market: freight volumes, freight rates, fleet capacity, fuel price, and financing. Combined into a single score, the number represents good, optimistic conditions when positive and bad, pessimistic conditions when negative.
According to Bloomington, Indiana-based FTR, falling diesel prices and rising freight volumes were the principal factors behind that improvement, but strong freight rates remain the bedrock of robust market conditions for trucking companies. Looking into the future, FTR expects conditions to remain positive for carriers through 2022 with gradual easing, but swings in fuel prices could maintain volatility.
“Government data concerning the labor market is starting to reinforce our analysis that overall driver capacity is not as tight as would be implied by stubbornly high freight rates. We still believe that the distribution of drivers in the market rather than the total number of drivers is the key issue,” Avery Vise, FTR’s vice president of trucking, said in a release. “The market could remain stressed until capacity stops shifting from larger carriers to smaller ones. Potential catalysts for reversing this shift include continued sharp increases in fuel costs, a falloff in freight demand, or continued incremental gains in the driver supply among larger carriers, but none of those developments is a sure bet.”