AAR reports April 2012 carloads are down and intermodal is up annually

April carloads—at 1,113,105—were down 64,335 carloads or 5.5 percent annually. Intermodal—at 946,951 trailers and containers—was up 32,505 units or 3.6 percent compared to April 2011.

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As has been the case for most of 2012 on the tracks, April volumes were mixed, according to data released this week by the Association of American Railroads (AAR).

April carloads—at 1,113,105—were down 64,335 carloads or 5.5 percent annually. Intermodal—at 946,951 trailers and containers—was up 32,505 units or 3.6 percent compared to April 2011.

Of the 20 commodity categories tracked by the AAR, 12 saw gains in April. Petroleum and petroleum products were up 43.1 percent or 11,376 carloads, and motor vehicle and parts were up 21.1 percent or 11,360 carloads. Crushed stone, gravel, and sand were up 9.3 percent or 6,617 carloads.

Coal continued to decline significantly, with carloads falling 85,719 carloads or 16.6 percent. AAR officials said this is the single biggest annual percentage decline on record for coal.

Other commodities posting April declines were grain, which fell by 16,402 carloads or 17.2 percent, and iron, steel, and scrap, which fell 5.3 percent or 1,067 carloads, among others.

Even with ongoing mixed volumes, the AAR remains positive overall about industry volumes and trends.

“In 2011, U.S. freight railroads reinvested more than ever before in the national rail network, because they know America’s manufacturers, farmers, and resource producers need to move freight safely and cost effectively to continue to grow in the years ahead,” said AAR Senior Vice President John T. Gray in a statement. “Month-to-month trends may vary, but the long-term demand for rail service will certainly rise.”

Various industry analysts have echoed Gray’s thoughts, too, and very strong first quarter Class I carrier earnings also bear that out, with carriers noting service levels are high—due in part to lower coal-related volumes—and pricing holding strong or increasing in many cases.

“In the beginning of the year 2012, rails faced what appeared to be the crisis of a lifetime, a nightmare scenario of a still-uncertain economy and what some have dubbed ;the end of the coal age,’” wrote Tony Hatch, principal of ABH Consulting, in a research note. “So how did rails perform in the quarter?  Well, their earnings per share increased fully 33 percent, perhaps five times more than the overall market. How did they do it?  Well, they had compensating growth in other areas—much of it shale related, as well as chemicals (itself an industry given new life by cheap natural gas), autos, steel and intermodal.  And they proved that they can continue to increase productivity (in this case the warm weather that giveth the utilities stockpiles also taketh cost out of railroading – as well as systemic improvements).  The rails also began what will be an all time record capex year ($13 billion).”

On the employment side, the AAR reported that Class I employment increased to 160,523 in March 2012 (the month for which most recent data is available), which was up 1,295 employees from February 2012, and is its highest level since December 2008.  The AAR added that total Class I employment in March was up by 4,861 employees, which marked a 3 percent gain over March 2011. Roughly two-thirds of these gains were due to an increase in maintenance of way ands structures employees, said the AAR.

And as of April 1, the AAR said that 309,957 freight cars were in storage, which is up 8,633 since April 1 and represents about 20.1 percent of the North American fleet. The AAR also noted that total cars in storage have increased for the past five months. 

For the week ending April 28, the AAR reported that U.S. carloads—at 283,080—were down 4.1 percent annually. And intermodal—at 242,365—was up 5.5 percent annually.  And for the first 17 weeks of 2012, the AAR said that U.S. railroad carloads were down 3.2 percent at 4,792,195, while intermodal was up 2.8 percent at 3,875,396 trailers and containers.


About the Author

Jeff 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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Article Topics

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