Monday, December 10, 2018

AAR: November Rail Carloads Down 0.2% YoY, Intermodal Up 2.5% YoY

by Calculated Risk on 12/10/2018 12:15:00 PM

From the Association of American Railroads (AAR) Rail Time Indicators. Graphs and excerpts reprinted with permission.

It’s not like the sky is falling or anything, but while U.S. rail traffic numbers were very solid a few months ago, they were less solid in November. Total carloads fell 0.2% (2,418 carloads) in November 2018 from November 2017, their first decline in nine months. Major blame goes to crushed stone, sand, and gravel, carloads of which fell 12.8% (12,090 carloads) thanks to a decline in carloads of frac sand. … Intermodal rose 2.5% in November. That sounds pretty good, but it’s the smallest increase in 19 months. ... In terms of rail traffic, November might just be the “back” in a case of two steps forward, one step back. But it could be the start of something more. Stay tuned.
emphasis added
Rail Traffic Click on graph for larger image.

This graph from the Rail Time Indicators report shows U.S. average weekly rail carloads (NSA).  Light blue is 2018.

Rail carloads have been weak over the last decade due to the decline in coal shipments.
Rail carload volumes in some recent months were impressive. In November? Not so much. U.S. railroads originated 1.032 million carloads in November 2018, down 0.2%, or 2,418 carloads, from November 2017. It was the first year-over-year decline for total carloads in nine months (see the bottom left chart below). Weekly average total carloads in November 2018 were 258,017, the lowest for November since sometime before 1988, which is when our data begin.
Rail TrafficThe second graph is for intermodal traffic (using intermodal or shipping containers):
U.S. rail carloads weren’t as impressive in November as they were in other recent months. The same goes for intermodal. U.S. railroads originated 1.10 million containers and trailers in November 2018, up from 1.07 million in November 2017. The 2.5% gain this year over last is the smallest monthly percentage gain in 19 months. Year-to-date intermodal volume through November was up 5.5%, or 699,102 units, over last year. If that percentage holds for one more month, 2018 will have the largest annual percentage gain for intermodal since 2010.
2018 will be another record year for intermodal traffic.