Shippers maintain upper hand according to FTR’s SCI

The new edition of the Shipping Conditions Index (SCI) issued last week by freight transportation consultancy FTR saw an increase amid what could be viewed as mixed market conditions.

FTR describes the SCI as an indicator that sums up all market influences that affect the transport environment for shippers, with a reading above zero being favorable and a reading below being unfavorable and a “less-than-ideal environment for shippers.”

For April, the most recent month for which data is available, the SCI came in at 7.5. This topped March’s 4.5 reading, which was preceded by February’s 5.1 and January’s 5.4, with the January and February readings nearly half of December’s 10.3, to finish 2022. November’s 3.0 reading was preceded by -3.1 and -0.3 readings in September and October, respectively.

FTR said that a weaker environment for both freight rates and carrier utilization more than offset slightly stronger freight demand and a deceleration of fuel cost decreases in April, adding that the outlook is positive through mid-2024.

“Shippers conditions improved in April as weaker rates and carrier utilization helped support shippers,” said Todd Tranausky, vice president of rail and intermodal at FTR, in a statement. “The outlook is for a firmly positive outlook for shippers in the economic balance of power between themselves and carriers for at least another 12 months. Economic uncertainty or a higher-than-expected amount of economic weakness could bump that time frame further out into the future and extend the good ride shippers have had over the last few months.”

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