Diesel prices main trucking conditions headwind: FTR

Trucking conditions in the U.S. deteriorated in October due to rising diesel prices, according to the latest Trucking Conditions Index (TCI) from industry forecaster FTR. Freight rates remained the leading positive factor, while freight volumes and utilization improved from September. With fuel prices now stabilized, FTR is projecting the index to remain solidly positive well into 2022.

The TCI read 7.75 in October, the weakest reading since July 2020.

"October was an outlier due to the brief surge in diesel prices, but conditions in 2022 are unlikely to be quite as robust for carriers as they are today," said Avery Vise, vice-president - trucking, with FTR. "We expect slower growth in freight volume and a slight easing of capacity utilization resulting in a gradual stabilization of freight rates at an elevated level. Even so, market conditions should favor carriers at least into 2023.

Potential downside risks for this outlook include further gains in driver capacity and a sharply reduced consumer spending due to inflation and a loss of stimulus.

However, the pent-up demand in the automotive sector could offset any softening due to those factors."