RAIL TRAFFIC REBOUNDS SHARPLY

Rail traffic is showing big gains this week after last week’s sharp decline.  The data has been choppy over the last few weeks, but the 10 week trend remains firmly positive.  The volatility is not unusual in this data so it’s important to maintain some perspective of the trend.  Total carloads were up 5.5% compared to last year while intermodal traffic rose 7.4%.  ARR has more details on the data:

“The Association of American Railroads (AAR) today reported an increase in weekly rail traffic for the week ending January 14, 2012, with U.S. railroads originating 298,560 carloads, up 5.5 percent compared with the same week last year. Intermodal volume for the week totaled 229,091 trailers and containers, up 7.4 percent compared with the same week last year.

Seventeen of the 20 carload commodity groups posted increases compared with the same week in 2011, with crushed stone, sand and gravel, up 33.2 percent; motor vehicles and equipment, up 31.5 percent, and petroleum products, up 28.9 percent.  The groups showing a significant decrease in weekly traffic included grain, down 10.1 percent.

Weekly carload volume on Eastern railroads was up 5.3 percent compared with the same week last year. In the West, weekly carload volume was up 5.6 percent compared with the same week in 2011.

For the first two weeks of 2012, U.S. railroads reported cumulative volume of 573,412 carloads, up 0.9 percent from last year, and 422,903 trailers and containers, down 1 percent from last year.”

Cullen Roche

Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.

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Comments

  1. The sharp delcine last week and sharp recovery here seems like a post holidy seans lull

    But I don’t know jack about Rail traffic, so….

    • I’ve tracked both and found that intermodal gives a slightly better forecasting edge. Can’t be certain that past is prologue, but I don’t have much else to work with….

  2. But if we look at the cumulative 2 weeks traffic for the weeks ending January 14 2012 we can see intermodal units orriginated during 2012 as 365,127 and during 2011 365,239 (thats flat). I take your point about the 10 week moving average but the two week moving average is not so hot.
    Next up I would have some queries about some of the individual categories. For instance why are petroleum products up 20% when demand is pretty low for this time of year and why are oil stocks depleted at cushing. There may be an element of export factored in here. Crushed Stone, sand and gravel is up again this week, but appears to be very volatile with perhaps the Mexican crushed stone , sand and gravel car loads being a leading indicator (down in Mexico). I also worry about the consistent rise in motor vehicles, in that it may have an element of channel stuffing, dispite on the face of it looking like a replacement cycle has kicked in.
    If I were to pick a category as an indicator then I think I might pick coal which is up about 1% on last year, bearing in mind this winter has not been as cold as last year I would take that as a rough indicator of growth between 1% and 2% year on year. Conversely there are some indicators (2 week moving average) that January might not be producing the growth that November and December did. Its all a bit noisy and too early to tell , but certainly a lot better than Europe.