Intermodal paces rail volumes again, says AAR

Spurred by another record-breaking week for intermodal, volumes on United States railways were up year-over-year for the week ending August 21, according to the Association of American Railroads (AAR).

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Spurred by another record-breaking week for intermodal, volumes on United States railways were up year-over-year for the week ending August 21, according to the Association of American Railroads (AAR).

Intermodal traffic—at 236,404 trailers and containers was up 22.4 percent year-over-year and 2.6 compared to 2008 levels, marking a new record for 2010 for the second straight week. This output topped the previous record high from the week ending August 14, which hit 233,767 trailers and containers. Both these weeks eclipsed the week ending August 7 at 231,208, and the week ending July 31 at 232,985 trailers and containers.
Intermodal container volume—at 202,475— was up 24.2 percent compared to 2009 and up 11.5 percent compared to 2008. AAR officials said this is the highest weekly intermodal container tally on record for the second straight week. And trailer volume—at 33,929— was up 12.4 percent and down 30.5 percent compared to 2008.

Weekly carload volumes—at 296,634—were up 6.2 percent year-over-year and down 11 percent compared to 2008. The beat the week ending August 14 at 295,948 and the week ending August 7, which hit 284,507, and fell short of the week ending July 31, which hit 300,292 carloads, which is the best weekly carload output for all of 2010.

In October 2009, the AAR began reporting weekly rail traffic with year-over-year comparisons for the previous two years, due to the fact that the economic downturn was in full effect at this time a year ago, and global trade was bottoming and economic activity was below current levels.

Carload volume in the East was up 6.1 percent year-over-year and down 14 percent compared to 2008. And out West carloads were up 6.2 percent year-over-year and down 8.9 percent compared to 2008.

As LM has reported, domestic intermodal performance continues to be strong, due, in part, to a tightening of truckload capacity, which has some shippers converting to intermodal. This is indicative, said the AAR, of a years-long trend of domestic freight converting from truck trailers to containers on rail; truck trailers can be double-stacked, which makes them more cost-efficient and effective.

The surge in intermodal has been reflected in recent notable developments, including:
-the Intermodal Association of North America’s (IANA) second quarter Market Trends report, which noted second quarter intermodal loadings—at 2,829,971—were up 17.2 percent year-over-year;
-USA Truck’s announcement that it inked a long-term contract with Class I railroad carrier BNSF Railway to move private 53-foot domestic intermodal containers; and
-The Greenbrier Companies’ announcement this week that it has received orders for over 1,000 new double-stack intermodal platforms, along with orders for over 700 new covered hopper cars, along with Greenbrier re-engineering and modifying approximately 1,100 existing double-stack platforms to 53’ from smaller dimensions.

While rail volumes are relatively healthy, current volumes are still below previous peak levels and are starting to face tougher year-over-year comparisons through the remainder of 2010, given the fact that 2009 was a down year for the rails in terms of volume growth.
Year-to-date, total U.S. carload volumes at 9,338,360 carloads are up 7.1 percent year-over-year and down 13 percent compared to 2008. Trailers or containers at 7,020,224 are up 14.2 percent year-over-year and down 5.4 percent compared to 2008.
Of the 19 carload commodities tracked by the AAR, 14 were up year-over-year. Metallic ores were up 54.6 percent and metals & products were up 43 percent. Nonmetallic minerals were down 8.3 percent.
Weekly rail volume was estimated at 32.6 billion ton-miles, a 7.9 percent year-over-year increase. And total volume year-to-date at 1,027.5 billion ton-miles was up 8.3 percent year-over-year.


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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Hub Group Resources
Not Your Grandfather's Intermodal
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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