Railroad shipping: AAR reports volumes are down 8.9 percent for the week ending November 14
Jeff Berman, Group News Editor -- Logistics Management, 11/20/2009
WASHINGTON-The Association of American Railroads reported this week that total volume for the week ending November 14 was down percent 8.9 compared to the corresponding week last year and 17 percent from the same week in 2007.
Last month, AAR officials said that they will be reporting 2009 weekly rail traffic with year-over-year comparisons for 2008 and 2007 from this point on, because at this time a year ago is when the economic downturn began to take hold.
Weekly carload freight, which does not include intermodal data, was 281,218 carloads, which topped the week ending November 7 which hit 274,486 carloads and the week ending October 31 at 275,349. Carloads were down 8.2 percent in the West year-over-year and 14.1 percent compared to 2007. And in the East, carloads were down 10 percent year-over-year and 21 percent compared to 2007.
Intermodal container and trailer volumes-at 208,056 trailers and containers-were down 7.7 percent year-over-year and are also up on a sequential basis compared to 206,890 for the week ending November 7. Intermodal volumes are up the last three weeks, and the week ending November 14 matches up favorably with the week ending October-the highest week of the year, which hit 208,941. Intermodal container volume was off 1.5 percent year-over-year and 8.3 percent compared to 2007, while trailer volume was off 30.2 percent year-over-year and 38.3 percent compared to 2007.
As LM has previously reported, while intermodal 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, these volumes have settled into the 200,000-to-210,000 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.
"From a traffic flow perspective, it is still an overall lousy snapshot," said an industry analyst. "We are reaching a new level ground although it is still well below last year. But there is some optimism...and easier year-over-year comparisons, too. These numbers continue to tell us that the economy is not getting worse, but there are no obvious signs things are getting better in the near future."
Considered a valid economic indicator, weekly rail volume was estimated at 31.6 billion ton-miles, which is ahead of last week's 30.8 billion ton-miles. This is down 7.9 percent and 11.2 percent compared to 2008 and 2007, respectively.
Stifel Nicolaus Analyst John Larkin wrote in a recent research note that ton-miles have averaged 30.9 billion per week in the fourth quarter to date, which is the highest weekly average in a quarter since the fourth quarter of 2008, which hit 31.7 billion.
Of the 19 commodities tracked by the AAR, 13 were down year-over-year, with grain up 16 percent and chemicals up 8.5 percent. Lumber and wood products were down 34.2 percent, and coal loadings were down 15.7 percent. Motor vehicles and equipment were down 0.1 percent and lumber & wood products were down 22.3 percent.
Through the first 45 weeks of 2009, the AAR said that U.S. railroads reported cumulative volume of 12,038,537 a 17.6 percent annual decline and an 18.3 percent decline from 2007. Trailers or containers-at 8,588,586-were down 15.9 percent from 2008 and 18.5 percent from 2007. And total volume of an estimated 1.29 trillion ton-miles was down 16.6 percent from 2008 and 16.9 percent from 2007.
"Reported [year-over-year] volumes should continue to trend less worse as comps continue to ease going forward, but absolute volumes should begin declining into the end of the peak shipping season and holiday shutdowns," wrote Wolfe Research President Ed Wolfe in a research note.
View All On-Demand Webcasts