Railroad shipping: AAR reports volumes for the week ending October 24 are down
Jeff Berman, Group News Editor -- Logistics Management, 10/29/2009
WASHINGTON-The Association of American Railroads (AAR) reported today that total volume for the week ending October 24 was down 14.8 percent compared to the corresponding week last year and 17.3 percent from the same week in 2007.
AAR officials said that they will be reporting 2009 weekly rail traffic with year-over-year comparisons for 2008 and 2007 going forward, due to the fact that at this time a year ago the economic downturn began to take effect.
Weekly carload freight, which does not include intermodal data, was 276,357 carloads, which edged out the week ending October 17 tally of 275,545. Carloads were down 14.8 percent in the West year-over-year and 15.8 percent compared to 2007. And in the East, carloads were down 14.8 percent year-over-year and 19.4 percent compared to 2007.
Intermodal container and trailer volumes-at 207,401 trailers or containers-were down 10.1 percent year-over-year and 14.5 percent compared to 2007. Container volume was off 3.6 percent year-over-year and 7.4 percent compared to 2007, while trailer volume was off 34.7 percent year-over-year and 40.1 percent compared to 2007. As LM has previously reported, while inter-modal volumes remain down, there continues to be steady improvement in recent weeks compared to pre-Labor Day volumes, which were in the 189,000-200,000 range.
In recent weeks, the AAR, railroad executives and industry analysts have stated that rail volumes continue to reflect the overall economy and also pointed out that volumes appear to be stabilizing and not getting incrementally worse.
But even with weaker year-over-comparisons, many industry experts contend that even with these signs of stabilization there are no obvious or immediate signs conditions are truly improving. And even with weekly volumes appearing "less worse," analysts maintain that demand remains week, which is continually reflected in these weekly numbers.
Often considered a valid economic indicator, weekly rail volume was estimated at 31.1 billion ton-miles by the AAR, which is down 13.1 percent year-over-year and down 11.1 percent compared to 2007. On a sequential basis, it was slightly ahead of the 31.0 billion ton-miles recorded for the week ending October 17.
Of the 19 commodities tracked by the AAR, 17 were down year-over-year, with grain up 6.2 percent and grain mill products up 9.6 percent. Motor vehicles and equipment were down 13.5 percent and metals and products were down 20.9 percent. Coal loadings were down 16.4 percent.
"[This data] suggests continued overall strength in industrial carloads, with intermodal containers continuing its steady uptrend," said Donald Broughton, Avondale Partners analyst, in a research note. "Within industrial carloads, motor vehicles and metals have recently slowed from their strong ascent following the cash for clunkers government stimulus program. Chemicals continue to show a strong overall trend. Forest remained weak, while Coal remained weak given the relatively overstocked levels of coal at utilities."
Through the first 42 weeks of 2009, the AAR said that U.S. railroads reported cumulative volume of 11,207,180 carloads, an 18 percent annual decline and an 18.3 percent decline from 2007. Trailers or containers-at 7,969,780-were down 16.4 percent from 2008 and 18.3 percent from 2007. And total volume of an estimated 1.2 trillion ton-miles was down 17.1 percent from 2008 and 15 percent from 2007.
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