AAR reports annual gains in October for carloads and intermodal volumes
October carloads—at 1,443,609—were up 1.5 percent—or 21,059 carloads— annually, and intermodal volumes were impressive, rising 6.8 percent (or 84,120 units) to 1,317,601 containers and trailers.
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Carload and intermodal volumes both saw annual gains in October, according to the Association of American Railroads (AAR).
October carloads—at 1,443,609—were up 1.5 percent—or 21,059 carloads— annually. AAR said this represents the largest year-over-year carload percentage gain in the last 22 months, adding that October 2012 was impacted by Hurricane Sandy. When taking out coal and grain, the AAR said that U.S. carloads were up 5.6 percent (or 42,037 carloads).
On a year-to-date basis, U.S. rail carloads are down 0.7 percent at 12,384,147.
Of the 20 carload commodities tracked by the AAR, 15 were up compared to October 2012. Grain was up 9.3 percent (or 9,450 carloads), and petroleum and petroleum products were up 14.2 percent (or 8,426 carloads). Coal was down 5.4 percent (or 30,428 carloads), and farm products excluding grain were down 46.2 percent (or 3,738 carloads).
Not to be overlooked in the carload figures is the continuing strength of crude oil carloads, more commonly known in industry circles as crude by rail. For the third quarter, the AAR said that U.S. Class I railroads originated 93,312 carloads of crude oil, which is up 44.3 percent compared to the third quarter of 2012 and down 14.1 percent from the second quarter of this year, which hit 108,605.
“There’s been some concern lately that the recovery may be running out of steam. Rail traffic data for October doesn’t seem to support that,” said AAR Senior Vice President John T. Gray in a statement. “A number of economically sensitive commodities, like lumber, autos, and chemicals, saw higher traffic volumes in October. The sharp increase in grain carloadings is a welcome change and points to the cooperative relationship railroads have established with their partners in the agricultural community.”
Intermodal volumes were impressive in October, rising 6.8 percent (or 84,120 units) to 1,317,601 containers and trailers. And the weekly average of 263,520 intermodal units is the single highest weekly average ever recorded, according to the AAR.
The growth in intermodal, especially on the domestic side, is not a huge surprise. The Intermodal Association of North America (IANA) recently reported that domestic intermodal container volumes have led the charge for ten straight quarters. And IANA President and CEO Joni Casey told LM that intermodal continues to provide myriad benefits for shippers, including: more consistent, economical service; conversions from highway based on pricing differentials; shippers already using intermodal increasing their spend; transloading volumes; and small growth contribution of intermodal trailers.
What’s more, domestic intermodal has been on a strong growth track due to things like lower fuel cost and improving service, as well as major investments into rail networks, spurring the thesis that that intermodal is taking share from over the road trucking and will continue to be an area of secular growth for railroads.
For the week ending November 2, the AAR said that U.S. rails moved 292,298 carloads for a 5.1 percent annual gain. This is below the week ending October 26 at 297,455 and ahead of the week ending October 19 at 289,256.
Intermodal for the week ending November 3 hit 264,264 trailers and containers for a 17.7 percent annual increase. This was ahead of the week ending October 26 at 261,231 and behind the week ending October 19 at 264,687.
Intermodal is up 4.0 percent annually year-to-date at 10,865,365 containers and trailers.
About the AuthorJeff Berman, Group News Editor Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman
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Transportation of freight in containers was first recorded around 1780 to move coal along England’s Bridgewater Canal. However, "modern" intermodal rail service by a major U.S. railroad only dates back to 1936. Malcom McLean’s Sea-Land Service significantly advanced intermodalism, showing how freight could be loaded into a “container” and moved by two or more modes economically and conveniently. As with all new technologies, there were problems that slowed the growth, which influenced many potential customers to shy away from moving intermodal.
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