FTR’s Shipping Conditions Index for November remained in deeply negative territory at -9.04 although improved from the October reading of -11.6. The improvement was primarily due to some stabilization in capacity utilization but utilization and rates remained very elevated, a negative for shippers. Shippers market conditions were further challenged with strong freight volumes and fuel costs continuing to rise. The outlook for 2021 is better but still resulting in negative SCI readings through the year.

Jonathan Starks, chief intelligence officer at FTR, commented, “No matter which mode or region, freight rates continued to stay elevated as we finished off 2020 and moved into the new year. Demand may be leveling off, but we are still seeing truck volumes in the spot market that are double the five-year average. In the intermodal arena we are seeing that ports and other stakeholders were not able to use the holidays to catch up on congestion issues that have plagued some markets. However, intermodal loadings are still well above prior year and the typical seasonal lull in Q1 may not appear this year.

“Manufacturers in China are not expected to take the normal two-week shutdown for Chinese New Year activities. With the holiday not occurring until mid-February, the market typically would expect high import volumes in late February followed by a noted slowdown in activity for a few more weeks. This could make it more difficult for the ports to get ahead of the vessel delays and port congestion until mid-year.”

The January issue of FTR’s Shippers Update, published January 8 provides a detailed analysis of the factors affecting the November Shippers Conditions Index and provides the forecast for this index through November of 2021. Additional commentary discusses forecast risks and renewed uncertainty for 2021.

The Shippers Conditions Index tracks the changes representing four major conditions in the U.S. full-load freight market. These conditions are: freight demand, freight rates, fleet capacity, and fuel price. The individual metrics are combined into a single index that tracks the market conditions that influence the shippers’ freight transport environment. A positive score represents good, optimistic conditions. A negative score represents bad, pessimistic conditions. The index tells you the industry’s health at a glance.