U.S. carload and intermodal volumes are up in February, reports AAR

Both United States rail carload and intermodal volumes posted annual volume gains in February, according to data issued by the Association of American Railroads (AAR).

Carloads were up 6.7 percent, or 65,141, to 1,044,040, with 11 of the 20 carload categories tracked by the AAR up annually, including: Coal, up 19.2 percent or 57,589 carloads; crushed stone, gravel, and sand, up 13.1 percent or 10,091 carloads; and primary metal products, up 6.8 percent or 2,357 carloads. Declining annual commodities in February include: petroleum and petroleum products, down 12.4 percent or 5,543 carloads for its 21st consecutive monthly decline; motor vehicles and parts, down 4.8 percent or 3,746; carloads and metallic ores, down 19.1 percent or 2,793 carloads.  Excluding coal, AAR said carloads were up 1.1 percent or 7,552 carloads in February 2017 from February 2016.

And the average carloads per week in February at 261,010, were up 6.7 percent annually and hit its highest level since November’s average of 263,002.

“The 19.2 percent increase in coal carloads in February 2017 was the highest percentage gain for coal since sometime before 1988 when our current record series began,” said AAR Senior Vice President of Policy and Economics John T. Gray in a statement.  “While it's an impressive gain, February 2017 was, unfortunately, also the second worst February in absolute terms for coal since sometime before 1988.  It's all too representative of the challenges railroads are facing as their markets change.  However, these same market changes are offering new opportunities. Over the past 15 years, the industry has worked hard to create a solid foundation to exploit these opportunities.”

On the intermodal side, containers and trailers in February at 1,068,439, rose 1.8 percent, or 19,350 units, compared to February 2016.

On a year-to-date basis through the first 8 weeks of 2017, U.S carloads are up 4.8 percent at 2,040,613, with intermodal up 0.04 percent at 2,089,507.

For the week ending February 25, U.S. carloads were up 3.5 percent annually at 256,756, and intermodal was down 3 percent at 264,965.

Baird and Co. analyst Ben Hartford wrote in a research note that railroad volumes remained above traditional seasonal levels through February, calling the over all industry outlook healthy and unchanged, while stating how Class I management teams expect first quarter volume growth to be slightly positive on an annual basis as well as for all of 2017, citing healthy quarter to date trends and a moderating coal headwind.