Railroad shipping: August volumes down 1.0 percent, says AAR

Jeff Berman, Senior Editor -- Logistics Management, 9/7/2007

WASHINGTON—Railroad carload and intermodal volumes on United States railroads for August were down once again this month compared to the same timeframe last year, according to data released by the Association of American Railroads (AAR) this week.

The AAR reported that U.S. railroads originated 1,685,238 carloads of freight in August, which was down 1.0 percent or 17,008 carloads from August 2006. Intermodal volume originated 1,195,390 trailers and containers for the month, which was off 4.2 percent—or 52,263 units—compared to a year ago.

In what has been somewhat of a recurrent theme on the nation’s railroads this year, economic conditions “continue to soften rail traffic volumes…[although] last week’s preliminary GDP figure of 3.4 percent for the second quarter of 2007, up from 0.6 percent during the first quarter, is a hopeful signal of a return to a more solid expansion,” said AAR Vice President Craig F. Rockey in a statement.

Another factor that affected railroad volumes was bad weather conditions throughout August, AAR Director of Editorial Services Tom White told Logistics Management. “[Weather conditions] particularly in the Midwest area where flooding put a number of tracks out of service for varying lengths of time, [impacted freight volumes].”

Aside from the ongoing economic malaise and weather woes, White said August’s numbers were somewhat status quo, considering how volumes have been down on a monthly basis after a record-breaking 2006 on the rails.

Of the 19 commodities tracked by the AAR, eight had year-over-year increases compared to August 2006, with motor vehicles and equipment up 4.8 percent—or 4,700 carloads, chemicals were up 2.3 percent—or 3,452 carloads, and grain was up 5.8 percent—or 6,561 carloads.

White said the fact that these three commodities had monthly gains is encouraging, especially the motor vehicles and equipment volumes that are occurring during a trying year for the automotive industry. And grain’s performance is reflective of what has been a strong growth harvest season to date, according to White.

Commodities seeing declines included lumber and wood products down 16.8 percent and crushed stone, sand, and gravel, down 8.7 percent. Both these declines are indicative of a difficult housing market conditions.

The AAR reported that for the first eight months of the year U.S. rail carloads were down 414,977 carloads—or 3.5 percent—to 11,367,593 carloads. U.S. intermodal traffic, which includes trailers and containers on flat cars and not included in carload figures, was down 154,217 trailers and containers—or 1.9 percent—to 8,061,355 units for the first eight months of the year.