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FTR predicts rate, supply pressures

Posted: February 23, 2017

BLOOMINGTON, IN – The freight transportation forecasters at FTR foresee rate and supply troubles for shippers as 2017 progresses, and expect capacity utilization to continue its climb toward a peak in 2018.

“Freight markets are currently operating at a relatively optimal level, with plenty of capacity to carry small increases in freight levels. This continues to give transportation managers the opportunity to focus on negotiating the best rates,” says Jonathan Starks, Chief Operating Officer, adding that the shipping environment is approaching a transitional time, with the potential for significant capacity shortages by the end of the year.

Starks says despite the rhetoric from the Trump administration to decrease regulatory burdens on companies, the pending Electronic Logging Device mandate will more than likely be introduced in December.

“Without a clear answer from an administration that is still in its infancy, shippers are wise to prepare for a full implementation, and to send clear signals to their carrier base that they need to be in compliance as well,” says Starks. “One word of caution for shippers is to keep an eye on how your negotiated contracts would be impacted by a severe capacity shortage. It may be wise for transportation managers to begin thinking about securing capacity, rather than focused on a purely rate-based negotiation.”

 

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