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1/30/2008



Rail News: Rail Industry Trends

Tie production and purchases tumble in December, remain down for '07


Talk about a one-two punch. In December, severe winter weather dragged down crosstie production while strong November demand held down tie purchases.

Production dropped 14 percent to 1.38 million ties and purchases plummeted 52 percent to 942,000 compared with November's totals, according to the Railway Tie Association's (RTA) monthly crosstie market report. Inventories inched up 2 percent to 16.8 million units and the inventory-to-sales ratio increased from 0.78 to 0.83.

During the fourth quarter, tie production totaled 4.9 million units, down 2.7 percent, and purchases totaled 4.5 million units, down 4.8 percent compared with fourth-quarter 2006 totals, showing "symptoms of economic slowing," RTA said.

For the full year, production clocked in at 20.7 million ties, or 9 percent fewer than in 2006.

"Purchases exhibited strong growth early in the year, fell back at mid-year, then stabilized at 20.3 million ties by year end — 4.8 percent down for the year," RTA said.

The tie inventory ended 2007 at 16.8 million units, up 1 percent compared with 2006's total.


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