AAR reports mixed volume results for week ending April 30

By Jeff Berman, Group News Editor
May 06, 2011 - LM Editorial

As has been the case in recent weeks, rail traffic for the week ending April 30 was mixed, according to data released by the Association of American Railroads (AAR).

Carload volume—at 295,347—was flat on an annual basis and ahead of the week ending April 23, which hit 292,706 and slightly behind the week ending April 16 at 295,426. It was also behind the week ending April 2, which hit 305,905 carloads, marking the highest weekly carload tally since the end of 2008.

Carload volume was down 2.4 percent in the East and up 1.7 percent out West. Carloads on a year-to-date basis are at 4,951,226 for a 3.8 percent year-over-year increase.

Intermodal volumes for the week ending April 30 at 229,677 trailers and containers were up 7.8 percent year-over-year. This outpaced the week ending April 23 at 225,668 trailers and containers, and was behind the week ending April 16 at 230,460 trailers and containers. Trailers and containers through the first 17 weeks of 2011 are at 3,770,745 for an 8.8 percent increase.

Despite the sequential decrease in intermodal volumes, intermodal continues to gain market share and increased interest from shippers that are dealing with increasing fuel costs for over-the-road transportation. That was made clear at last week’s NASSTRAC Logistics Conference and Expo, with several truckload carriers telling LM that their intermodal businesses are on the rise, due to shippers seeking cost relief from rising diesel prices in exchange for an extra day or two of transit times.

Of the 20 commodity groups tracked by the AAR, 9 were up annually. Metallic ores were up 22.1 percent, and grain loadings were up 7.4 percent. Coal was down 1.9 percent, and farm products excluding grain were down 6.0 percent.

Estimated ton-miles for the week were 32.7 billion for a 0.9 percent annual decrease, and on a year-to-date basis, the 555.7 billion ton-miles recorded are up 5.0 percent.

With Class I rail carriers reporting first quarter earnings in recent weeks, the overall takeaway was that rail service and intermodal providers are above the curve when it comes to pricing power and service during what is clearly becoming an industrial-led economic recovery rather than a consumer-led one.

“The freight rail industry handled the toughest winter on record fairly well, all in all, for the most part in batter shape then entering it as it prepares for what should be a strong 2011 as we move past ‘recovery’ to modest economic growth,” wrote Tony Hatch, principal of ABH Consulting, in a research note. “In such a scenario, the rails are poised to gain market share, grow revenues and earnings above S&P500 levels, and demonstrate higher levels of share, service, productivity and incremental margin growth than even a fairly bullish Wall Street expects.”

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About the Author

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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. .(JavaScript must be enabled to view this email address).


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About the Author

Jeff Berman, 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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