Rail traffic continues to decline despite very easy year over year comps. In a sure sign of tepid recovery, we continue to see improvement off the lows, but a still very meager traffic trends. A recovering economy would have no problem overcoming the very low levels of last fall, but we actually continue to see declines. Total intermodal traffic was down 6.4% versus 2008 and down a staggering 32% versus 2007. The recovery on Wall Street might be real, but it’s certainly not real on Main Street as these numbers clearly show. A few commodity groups are showing strong year over year climbs, but all data is still very weak compared to 2007.
The AAR reports:
The Association of American Railroads today reported that freight rail traffic was down for the Thanksgiving holiday week ended Nov. 28, 2009. U.S. railroads reported originating 246,133 carloads for the week, down 3.9 percent compared with the same week in 2008 and down 29.3 percent from the same week in 2007. The comparison week from 2008 included the Thanksgiving Holiday, while the 2007 comparison week did not. In order to offer a complete picture of the progress in rail traffic, AAR will now be reporting 2009 weekly rail traffic with year over year comparisons for both 2008 and 2007.In the Western U.S., carloads were down 3.8 percent compared with the same week last year, and 23.9 percent compared with 2007. In the East, carloads were down 4.3 percent compared with 2008, and 37.3 percent compared with the same week in 2007.
Intermodal traffic totaled 165,856 trailers and containers, down 6.4 percent from a year ago and 32.1 percent from 2007. Compared with the same week in 2008, container volume dropped 0.9 percent and trailer volume dropped 27.2 percent. Compared with the same week in 2007, container volume fell 26.2 percent and trailer volume dropped 51.9 percent.
While 10 of the 19 carload freight commodity groups were down compared with the same week last year, increases were seen in nonmetallic minerals (38.1 percent), grain (21.3 percent), farm products not including grain (20.1 percent), motor vehicles and equipment (15 percent), chemicals (13.2 percent), grain mill products (11.5 percent), metals and products (11.2 percent), metallic ores (3.1 percent) and petroleum products (2.2 percent). Declines in commodity groups ranged from 0.9 percent for crushed stone, sand and gravel to 28.3 percent for coke.
Total volume on U.S. railroads for the week ending Nov. 28, 2009 was estimated at 27.6 billion ton-miles, down 3.8 percent compared with the same week last year and down 25 percent from 2007.
For the first 47 weeks of 2009, U.S. railroads reported cumulative volume of 12,571,696 carloads, down 17.1 percent from 2008 and 18.2 percent from 2007; 8,967,824 trailers or containers, down 15.5 percent from 2008 and 18.3 percent from 2007, and total volume of an estimated 1.35 trillion ton-miles, down 16.2 percent from 2008 and 16.7 percent from 2007.
Source: AAR, Railfax
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.