Rail traffic moved back into positive territory this week. The good news is that traffic isn’t collapsing. The bad news is that the days of strong growth appear to be behind us. The trend is clearly down to sideways. In my opinion, this is all consistent with the muddle through economy. Things aren’t terrible, but they aren’t great either. Thus far, the European disaster has proven to be a steady drain on global aggregate demand, but not enough to pull the world into a full blown recession. The news out of the BRICs is consistent with a slowing, but not a collapse. The key to the kingdom is held here.
The AAR elaborates on this week’s rail data:
“The Association of American Railroads (AAR) today reported a slight increase in weekly rail traffic, with U.S. railroads originating 278,382 carloads for the week ending September 10, 2011, up 0.1 percent compared with the same week last year. Intermodal volume for the week totaled 208,090 trailers and containers, up 0.6 percent compared with the same week last year.
Thirteen of the 20 carload commodity groups posted increases from the comparable week in 2010, including: stone, clay and glass products, up 20.3 percent; lumber and wood products, up 15.8 percent, and petroleum products, up 14 percent. Groups showing a decrease in weekly traffic included: farm products excluding grain, down 36.9 percent; grain, down 16.7 percent, and grain mill products, down 13 percent.
Weekly carload volume on Eastern railroads was down 2.7 percent compared with the same week last year. In the West, weekly carload volume was up 1.8 percent compared with the same week in 2010.
For the first 36 weeks of 2011, U.S. railroads reported cumulative volume of 10,411,861 carloads, up 1.8 percent from the same point last year, and 8,139,710 trailers and containers, up 5.7 percent from last year.”