Following a month that inched closer to positive territory in October, the Shippers Conditions Index (SCI) issued this week by freight transportation consultancy FTR, showed that November’s reading officially crossed the finish line in turning positive for the first time in more than two years.
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 zero being unfavorable and a “less-than-ideal environment for shippers.”
For November, the most recent month for which data is available, the SCI came in at 0.1, ahead of October’s -2.1. October, while negative, marked and improvement over September’s -7.6, as well as the 8.8 reading recorded in August. The July SCI reading was -9.9 and June was -9.5. May’s SCI was -12.3 and April’s was -13.4.
November’s SCI reading is that best one going back to August 2016. FTR said it expects the SCI to “stay within a range close to neutral throughout 2019, adding that it could head into further positive territory if freight demand weakens further, should freight demand further weaken in tandem with strong truck buying, as well as improved driver hiring pushing rates lower.
“Conditions have improved noticeably for shippers in the last few months,” said Todd Tranausky, FTR vice president of rail and intermodal, in a statement. “The prospect of sustained lower fuel prices, increasing capacity in the truck and rail sectors, and the first signs of a turn in rail service raise the prospect of a much better 2019 than shippers expected during much of 2018.”