The FTR Trucking Conditions Index jumped 30 percent in July from June on expectations for a “modest” fall peak for shippers and carriers.
The index rose to 8.41 in July. A reading above zero indicates a positive market for truckers, readings above 10 indicate pricing, volume and margins are "solidly favorable."
FTR Associates believes shippers should prepare for an “uptick” in truck rates this fall, as federal regulations and freight demand combine to tighten capacity.
Despite lackluster freight demand, “[t]here is potential for a decent fall peak shipping season,” said Jonathan Starks, FTR’s director of transportation analysis.
He pointed to the ISM manufacturing index, which rose 0.3 percentage points to 55.7 in August, indicating continued expansion of manufacturing activity.
In addition, shippers are maintaining lean inventories, and inventory restocking is helping to boost U.S. imports, according to JOC Economist Mario O. Moreno.
FTR Associates isn’t predicting a prolonged upward spike in truck rates or a widespread capacity crunch, however, without much stronger economic growth.
“The continued slog of the overall economy makes it unlikely that we get the significant push in consumer activity that is needed to really start moving the needle on capacity constraints and upward rate activity,” Starks said.
Should any decent economic growth occur it should quickly show up in truck activity and tighten a market that has very little spare capacity," he said.
"The potential for an extremely tight truck market remains but is dependent on those external factors."