FTR releases new SCI edition with stark warning

Freight transportation consultancy FTR issued a new edition of its Shippers Conditions Index (SCI) and cautioned that the index could soon reflect what the firm described as “the most unfavorable market conditions ever for shippers.”

What the Shippers Conditions Index measures

The SCI is a primary logistics indicator that gauges freight market health for shippers by combining several key elements. It synthesizes data on rates, capacity and fuel to produce a single score that signals market tightness or looseness.

• Positive scores: indicate favorable conditions and greater carrier supply
• Negative scores: show tighter capacity and more challenging conditions for shippers
• Readings near zero: represent a neutral market and often fluctuate with economic shifts

Recent volatility and drivers of change

FTR noted the SCI has been volatile, moving toward tougher conditions when capacity tightens and improving as capacity eases. The index reacts to events such as spikes in fuel prices and regulatory changes, and FTR advised shippers to closely monitor trends for potential rate movements and bottlenecks.

Near-term forecast points to a four-year low

The firm said its near-term forecast expected the SCI to decline to its lowest level in four years. FTR emphasized that a combination of soaring fuel costs and a tightening freight market could produce the most unfavorable shipper conditions on record.

February reading outlook and geopolitical context

Before the US-Israel joint attack on Iran, FTR’s forecast predicted the February SCI reading would be lower than January’s -5.0, which was the weakest reading since July 2022. The firm flagged that geopolitical developments could affect market conditions and the index trajectory.

Record low reference and diesel price comparisons

FTR pointed to March 2022’s -23.1 as the lowest SCI reading on record, attributing that result to persistently difficult truck freight market conditions and an unprecedented $1.15 rise in diesel prices over a two-week span at that time. The firm added that the $0.96 diesel increase seen in the first week of March exceeds the March 2022 increase, and noted that performance in the coming weeks remained uncertain.

Industry perspective from FTR’s trucking lead

FTR’s vice president of trucking, Avery Vise, summarized the firm’s concern and context around current market dynamics.

“We wanted to highlight the possibility that the SCI soon could indicate the toughest overall conditions ever for shippers, though the freight components of the index are not yet as tough as they were in early 2022,” said Avery Vise. “However, the freight market then had started to cool from 2021’s extreme situation while today’s freight market—especially in trucking—is tightening. If the dramatic rise in diesel prices were to sideline even more capacity, the SCI quite plausibly could become even more unfavorable than it was in early 2022.”

What shippers should watch next

FTR’s analysis underscores the importance for shippers to track capacity levels, diesel price movements and regulatory or geopolitical developments that can quickly alter the SCI. The firm’s forecast and recent fuel price behavior suggest the market could continue to tighten, with implications for rates and available capacity.

Conflict forces carriers to stop Middle East bookings

Cargo backlogs are beginning to accumulate at major logistics hubs after ocean carriers suspended bookings to the Middle East amid the military clashes involving Iran, the U.S. and Israel. The booking halts are among several wide-ranging consequences identified by Jeremy Nixon, CEO of Ocean Network Express, as the conflict reverberates across global supply chains.

Extent of vessel congestion at the Strait of Hormuz

Nixon told attendees at TPM26 by S&P Global that roughly 750 ships are currently waiting because of the Strait of Hormuz closure. Of those vessels, about 100 are container ships, a figure that translates to roughly 10% of the world’s container fleet being affected by the disruption.

Rerouting of cargo and alternative ports

Vessels that intended to transit the Strait of Hormuz are being forced to turn back and head to alternate hubs. Nixon cited Colombo, Sri Lanka, among other ports, as destinations where ships will have to reposition, creating additional voyage time and logistical complexity for shippers and carriers alike.

Strain on Asian export hubs and terminal operations

Exports from Asia are expected to bear the heaviest burden of the disruption. Major regional transshipment and gateway ports, including the Port of Singapore, will begin to lose operational fluidity as a result. Nixon warned that the situation will prompt an immediate stop to new bookings for some sailings and can freeze cargo movements already in terminals.

Operational headaches for ports and rising freight costs

Nixon said the build-up will create specific challenges for port operators managing yard space and terminal throughput, while carriers will face the task of prioritizing empty containers and reshuffling other cargo. He also expects upward pressure on freight rates as capacity tightens.

“So, that's going to give a few headaches to the port operators in terms of their stack utilizations, the fluidity of their terminal, and then carriers are going to have to try to prioritize empties and move other cargo around,” ONE’s CEO said. “It'll inevitably have an impact on freight rates.”

Fuel prices and the risk of an oil shock

Nixon noted that fuel prices are already climbing amid the conflict. He warned that if the Strait of Hormuz remains closed beyond 25 days, oil and gas producers in the Middle East would start curtailing output because they would have nowhere to store or export hydrocarbons.

“They've got nowhere to put the oil and the gas,” Nixon said, adding that the market could see a significant price shock and that $100 a barrel is a plausible outcome if disruptions persist.

Source and licensing information

This report summarizes remarks made by Jeremy Nixon at TPM26 and is based on reporting by Kelly Stroh for Supply Chain Dive. The original story was legally licensed through the DiveMarketplace by Industry Dive. For licensing inquiries, contact legal@industrydive.com.

Supreme Court ruling prompted immediate tariff pivot

The Supreme Court found the Trump administration’s use of the International Emergency Economic Powers Act (IEEPA) to impose tariffs unlawful. In response, the White House quickly replaced that authority with a 10 percent duty under Section 122 for a 150-day term, scheduled to expire in late July.

Officials justified the temporary levy as a response to a serious international payment imbalance and a growing U.S. balance-of-payments deficit, as well as a tool to boost domestic manufacturing and to slow the flow of fentanyl across the U.S. border from Canada and Mexico.

USTR launches Section 301 investigations into excess capacity

The Office of the United States Trade Representative (USTR) this week opened investigations under Section 301 of the Trade Act of 1974. The probes target what the agency described as structural excess capacity and production in manufacturing sectors abroad.

USTR said the inquiries will assess whether foreign acts, policies, or practices are unreasonable or discriminatory and whether they burden or restrict U.S. commerce.

Countries and economies named in the investigations

The USTR listed multiple economies as subjects of the Section 301 reviews. The agency said it will examine industrial policies and production practices in these markets:

• China
• European Union
• Singapore
• Switzerland
• Norway
• Indonesia
• Malaysia
• Cambodia
• Thailand
• Korea
• Vietnam
• Taiwan
• Bangladesh
• Mexico
• Japan
• India

USTR frames probes as defense of U.S. industrial base

USTR Ambassador Jamieson Greer said the investigations reflect a determination not to sacrifice U.S. industry to foreign overproduction. He portrayed the reviews as part of a broader push to reshore critical supply chains and create well‑paying manufacturing jobs across the United States.

Greer argued that structural excess capacity in several partner economies has produced goods beyond domestic demand, displacing U.S. output and deterring investment that would otherwise expand American manufacturing. He warned that the United States has lost significant production capacity in many sectors and lagged behind foreign competitors.

Industry reaction and legal challenges to Section 301 measures

Industry advisers cautioned that Section 301 tariffs, which address unfair trade practices, can be difficult to challenge successfully in court. Pete Mento, Director of Global Trade Management Services at Baker Tilly, told LM that the mechanics of 301 actions make judicial challenges complex.

Mento noted that the government has been collecting information on issues such as forced labor and other unfair practices, an evidence base that could strengthen future 301 cases. He said issues like forced or slave labor, currency manipulation, and intellectual property infringement could all form the factual foundation for U.S. action under Section 301.

Investigation process, timeline, and possible remedies

Mento and USTR officials explained that if the investigations find policies or practices that unreasonably distort trade, the United States could respond with new duties or other measures.

The formal process outlined includes the following stages:

1. Investigation
2. Public comments
3. Hearings
4. Findings
5. Imposition of new duties (tariffs)

USTR said a docket for public comments will open on March 17 and that hearings will begin on May 5.

Analysts see limited broader economic impact but note other risks

In a research note, Chris Rogers, head of supply chain research at S&P Global Market Intelligence, suggested the overall economic effect of the recent trade moves may be muted. He said duty rates tied to IEEPA are likely to be replaced by other programs that deliver functionally similar rates.

Rogers added that the global economy has so far proved relatively resilient to tariffs, and that larger near-term risks may stem from uncertainty related to conflict in the Middle East and resulting pressures on oil prices.