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Shipping Conditions in August were weakest in two years, FTR says

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David Sickels is the Associate Editor of Tire Review and Fleet Equipment magazines. He has a history of working in the media, marketing and automotive industries in both print and online.

The FTR Shippers Conditions Index for August fell further into negative territory, to a reading of -1.79. Just four months after the strongest market conditions on record, shipping conditions in August were the weakest in two years, FTR says.

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While most factors affecting the Shipping Conditions Index in August were equal to or more favorable than in July, FTR says, the rate environment was significantly more unfavorable for shippers. The short-term outlook is for the SCI to improve; however, it is expected to become significantly negative in the second half of 2021 primarily due to tighter capacity and higher shipping rates.

“A rapid rise in freight volume coming out of the pandemic as retailers try to restock shelves quickly ahead of the holiday shopping season has created a deterioration in shippers’ power with carriers,” Todd Tranausky, vice president of rail and intermodal at FTR said. “The good news is that things should hold fairly neutral in the first half of 2021, but shippers will face more negative pressures in the final two quarters of 2021.”

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