United States rail carload and intermodal volumes saw annual declines in November, according to data issued this week by the Association of American Railroads (AAR).
Rail carloads, at 955,579, slipped 7.5%, or 77,166 carloads, compared to November 2018. AAR said that three of the 20 carload commodities it tracks saw annual gains, including: stone, clay & glass products, up 1,163 carloads or 4.1 percent; all other carloads, up 659 carloads or 2.7 percent; and primary forest products, up 143 carloads or 3.4 percent. Commodities with annual declines included: coal, down 49,419 carloads or 14.5 percent; crushed stone, sand & gravel, down 6,920 carloads or 8.4 percent; and primary metal products, down 5,447 carloads or 15.1 percent.
When removing coal, November carloads were off 27,747 carloads, or 4%, annually and when removing coal and grain, carloads decreased 26,887 carloads, or 4.5%.
This marks the tenth consecutive month U.S. rail carloads have seen an annual decline, confirming the AAR’s sentiment that U.S. railroads are in a freight recession.
“Rail traffic continues to struggle because U.S. manufacturing is soft, trade disputes and the uncertainty they entail are ongoing, and economic growth abroad isn’t what it could be,” said AAR Senior Vice President John T. Gray. “That said, we’re confident that rail volumes will begin to grow again as the manufacturing portion of the economy finds firmer footing.”
Intermodal containers and trailers, at 1,019,766, were off 7.4%, or 81,138 units, annually. Like carloads, this also marks the tenth consecutive month of annual declines.
A common theme, for these volumes, observed by the AAR is that the parts of the economy that generate much of the freight that move via railroads, including manufacturing and goods trading, have continued to weaken over the past several months.
On a media conference call this week, Gray said that when looking at volume differences between 2018 and 2019, it is key to note that 2018 can be viewed as an anomaly year, which bled into 2019, in some cases, including disruptions of the timing of shipments around the ongoing trade and tariff issues and market uncertainty in regards to investments and various supply chain changes taking place due to trade issues.
“It is hard to make year over year comparisons that are as meaningful as we would like them to be,” he said. “2019 has some of these same disruptions going on. With the roughly 2% GDP growth rate we are seeing, that is mostly based around consumption, not production.”
For the week ending November 30, which was likely impacted by the timing of the Thanksgiving holiday, AAR reported that U.S rail carloads, at 215,126, were off 21.3%, trailing the weeks ending November 23 and November 16, at 251,901 and 239,647, respectively. Intermodal containers and trailers, at 221,774, was off 24.5%, trailing the weeks ending November 23 and November 16, at 270,026 and 261,602, respectively.
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