BLOOMINGTON, Ind. — FTR’s Intermodal Competitive Index (ICI) for December at a reading of 6.98 keeps the measure in reasonably positive territory.
Intermodal experienced good gains finishing up 2016.
FTR expects the ICI to improve in the coming months with a more robust rate environment; however, there are more downside risks for intermodal as the year progresses, dependent upon trade policy changes under the new administration.
“About half of all North American intermodal volume depends, to a certain extent, on our international trade,” said Larry Gross, FTR partner and principal author of Intermodal Update.. “This includes cross-border movements and import/export movements, both in international containers and as transloaded cargo in domestic containers and trailers. As of today, we have not programmed in any potential effects from changes in U.S. trade policy, but such alterations could have a profound negative impact on intermodal prospects. Most damaging would be if we got into a tit-for-tat trade conflict with one or more of our worldwide trading partners, a prospect we still consider unlikely as of now.”
The Intermodal Competitive Index is a compilation of factors affecting the competitive posture of the domestic North American intermodal sector versus over-the-road truck.
Any reading below zero indicates a less-than-ideal environment for intermodal, while readings above zero are meant to communicate relatively favorable conditions.
The higher the reading, the more favorable the intermodal environment appears to be.
The ICI looks at a variety of factors including truck capacity, fuel prices, rail service, intermodal rates, and so forth.
Details of the factors affecting the December Intermodal Competitive Index, along with a close look at market conditions and what might be expected going forward, can be found in the February issue of FTR’s Intermodal Update published February 7.
For more information about the work of FTR, visit www.FTRintel.com, follow on Twitter @ftrintel, or call (888) 988-1699 Ext. 1.