by Calculated Risk on 12/06/2010 05:15:00 PM

From the Association of American Railroads: AAR Reports November 2010 Rail Traffic Continues Mixed Progress. The AAR reports carload traffic in November 2010 was up 4.5% compared to November 2009, however carload traffic was still lower than in November 2008. Intermodal traffic (using intermodal or shipping containers) is up 11.3% over November 2009 and up slightly over November 2008.

"Even though U.S. rail volumes were down in November from October levels — due largely to Thanksgiving — November marks the 11th straight month in which rail volumes were higher than year-earlier levels. That hasn’t happened since January 2006," said AAR Senior Vice President John Gray. "Granted, 2009 was a bad year for rail traffic, but like the economy in general, rail traffic has been slowly improving. We’re hopeful that recent gains in consumer confidence and some recent encouraging signs regarding consumer spending will mean a continuation of economic growth and further growth in rail traffic."

While railroads continue to bring employees back to work and cars out of storage, data show the pace slowed slightly in recent months. During the month of October, the most recent period for industry employment data, railroads added 191 people to the employee rolls. Railroads brought 465 rail cars out of storage in November, with 317,810 cars, or roughly 20.8 percent of the North American railcar fleet, still in storage.

Click on graph for larger image in new window.

This graph shows U.S. average weekly rail carloads (NSA). Traffic increased in 14 of 19 major commodity categories year-over-year.

From AAR:

• U.S. freight railroads originated an average of 284,407 carloads per week in November 2010 (see chart below left), for a total of 1,137,626 carloads for the month. That’s up 4.5% over November 2009. November was the ninth straight month with higher year-over-year average weekly rail carloads, something that hasn’t happened since 2004.

• On a seasonally adjusted basis, U.S. rail carloads were down 1.1% in November 2010 from October 2010. Seasonally-adjusted carloads on U.S. carriers have fallen (though by relatively small amounts) three of the past four months.

As the first graph shows, rail carload traffic collapsed in November 2008, and now, over a year into the recovery, carload traffic has only recovered part way.

The second graph is for intermodal traffic (using intermodal or shipping containers):

• On a non-seasonally adjusted basis, there is always a big decline in intermodal traffic in November from October, partly because many of the goods retailers stock for holiday sales are shipped in September and October and partly because of Thanksgiving. The week including Thanksgiving this year was the lowest-volume intermodal week of the year for U.S. railroads.

• Seasonally adjusted U.S. rail intermodal traffic was down 0.4% in November 2010 from October 2010, its third straight monthly decline. As with carloads, recent declines have been small.
excerpts with permission

The small seasonally adjusted declines suggest the recovery is very sluggish, or has even stalled, over the last few months.

Note: The Ceridian-UCLA diesel fuel index for November will be released tomorrow.