RAIL TRAFFIC DECLINES FOR FIRST MONTH SINCE FEBRUARY 2010

There is a fairly clear downtrend in rail traffic trends in recent weeks and months.  The April report from the AAR showed the first monthly decline since February 2010.  Comps were difficult, however, the negative trend has become more pronounced of late.  We are seeing this in the weekly reports as well. The AAR has the details on this month’s report:

“WASHINGTON, D.C. – May 9, 2011 – The Association of American Railroads (AAR) today reported that U.S. rail carloads in April 2011 decreased 0.2 percent compared with the same month last year, to 1,177,277 carloads.  According to AAR’s monthly Rail Time Indicators report, intermodal traffic in April increased 9 percent compared with April 2010 to 914,518 trailers and containers. On a seasonally adjusted basis, carloads were down 2.5 percent and intermodal traffic was up 1.2 percent compared with March 2011.

The latest railroad employment data shows the addition of 1,340 employees in March 2011, the largest since September 2010, bringing the industry to 155,842 employees nationwide.

“April’s carload decline is the first year-over-year monthly decline since February 2010,” said AAR Senior Vice President John Gray. “April 2010 was a relatively strong month and therefore a difficult comparison, and coal traffic was down for the first time since July 2010.  April’s carload decline was offset by continued intermodal growth.  Rail traffic deserves a close watch over the next several months because it’s a useful gauge of the strength of the economy.”

Overall, nine of 20 commodity categories saw carload gains on U.S. railroads in April 2011 compared with April 2010.  Traffic gains were led by grain, up 13.6 percent (11,377 carloads); metallic ores, up 19.4 percent (5,005 carloads), and motor vehicle and parts, up 9.6 percent (4,713 carloads). Coal carloads were down 2.9 percent (15,225 carloads). Other commodity groups with carload declines included crushed stone, sand, and gravel, down 5.6 percent (4,203 carloads);  waste and nonferrous scrap, down 14.2 percent (2,140 carloads), and primary forest products, down 26.4 percent (1,910 carloads).

Despite the mixed results this month, there are still positive signs of growth. Year-over-year chemical carloads have risen for 18 straight months. In addition, cumulative volume for the first four months of the year is also positive with U.S. rail carloads up 3.8 percent (180,791 carloads) and intermodal loadings up 8.8 percent (304,702 trailers and containers) compared with the same period in 2010.  Intermodal loadings in April 2011 averaged 228,630 units, the second highest average for any April in history, behind only April 2006.

As of May 1, 2011, 276,228 freight cars, or 18.2 percent of the fleet, were in storage. This represents a decrease of 7,421 cars from April 1, 2011.”

Source: AAR