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Rail News: Rail Industry Trends

RTA report: Tie production in high gear, purchases at low ebb in June

Crosstie production soared, but purchases plummeted in June. Production increased 4 percent to 1.9 million units and purchases decreased 39 percent to 1.3 million units compared with May levels, according to the Railway Tie Association’s (RTA) monthly market report.

“Production of wood crossties has gradually slowed over most of the past year, but picked up in May and June,” the report states. “Purchases have been less stable, exhibiting weakness in March and June.”

Also last month, the tie inventory rose 4 percent to 16.7 million units compared with May and the inventory-to-sales ratio rose from 0.78 to 0.84.

During the second quarter, tie production jumped 13 percent to 5.4 million units and purchases increased about 6 percent to 5.2 million units compared with the first quarter. But through the first half, production totaling 10.2 million units and purchases totaling 10.1 million units trailed first-half 2006 levels by 12 percent and 13 percent, respectively, RTA said.

Meanwhile, 12-month rolling market data shows purchases totaled 19.9 million units, down from May’s 21 million units and the previous 12-month rolling period’s 20.6 million units.

“Purchases had been growing at double-digit rates until April, but as of June declined 3.8 percent,” the report states.

Twelve-month rolling production totaled 21 million units, holding steady compared with May but decreasing 5.4 percent compared with the previous 12-month rolling period.

Contact Progressive Railroading editorial staff.

More News from 7/26/2007