Trucking Conditions Index Falls as Capacity Availability Increases

The FTR Trucking Conditions Index fell 9% to a reading of 6.7 in April, weakened by more available capacity and less pressure on rates.

The current suspension of Hours of Service rules contributed to the increased availability of capacity, says FTR, though low fuel prices in the month were a positive factor. Going forward, FTR believes the market will tighten and improve the environment for truckers.

Anticipating increased regulations in the coming years, FTR says it is likely that a capacity crisis could occur in 2017.

"While still at a reasonably strong level the TCI is indicating a moderating environment for carriers,” said Jonathan Starks, FTR’s director of transportation analysis. “Rate increases have pulled back over the last couple of months and, although still positive, will lessen year-over-year gains later in the year.”

Freight capacity is still returning to normal after 2014’s tight conditions which FTR says was indicated by data from the online load board, Truckstop.com.

“Shippers' desires to secure capacity should keep contract rates growing, but both contract and spot rates are susceptible to big drops if the economy is unable to accelerate after the weak start to 2015,” said Starks.