Trucking news and briefs for Friday, May 14, 2021:
Strong March for carriers leads to record high trucking conditions, FTR reports
FTR’s Trucking Conditions Index (TCI) for March, as reported in FTR’s May Trucking Update, surged to a record high of 16.27, up about five points from February. The prior record was 16.17, set in October 2020.
According to FTR, contributions from freight volume, rates and capacity utilization all strengthened in March.
“March’s record TCI was especially remarkable considering that the index’s fuel component – the month’s lone weakness – was the most negative it had been since before the Great Recession,” said Avery Vise, FTR’s vice president of trucking. “Robust demand and tight capacity no doubt are big operational headaches for many trucking operations, but those factors are supporting the best market conditions ever for carriers. We have yet to see signs of a loosening in driver capacity, so the near-term outlook is strong.”
Several data on trucking industry variables go into FTR’s monthly Trucking Conditions Index: freight volumes, freight rates, fleet capacity, fleet bankruptcies, fuel price and financing. The individual metrics are combined into a single index that tracks the market conditions that influence fleet behavior. A positive score represents good, optimistic conditions. A negative score represents bad, pessimistic conditions. The index purports to show the industry’s general health at a glance.
According to ACT's monthly Freight Forecast, ACT Research’s Vice President and Senior Analyst Tim Denoyer said supply side constraints will keep the truckload market "very tight" in the near-term, as freight demand remains exceptionally strong, "so the peak in spot markets remains ahead of us,” he added. “The semiconductor shortages impacting Class 8 tractor supply don’t have quick fixes, and neither do the structural factors inhibiting driver supply, such as demographics and drug testing.”
FTR expects the TCI to remain in positive double-digit territory at least through the third quarter, with the possibility of one or more record readings.
