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3/22/2007



Rail News: Rail Industry Trends

Tie purchases and production tumble in February, RTA says



After posting double-digit gains in January, crosstie purchases and production fell in February. Purchases totaling 1.86 million ties decreased 1.7 percent and production totaling 1.43 million ties declined about 11 percent on a month-over-month basis, according to the Railway Tie Association’s (RTA) monthly market report.

February’s production drop “pulled 430,000 ties out of inventory,” RTA said in the report. “This is the third consecutive month to experience inventory reduction.”

During 2007’s first two months, tie purchases jumped about 23 percent to 3.7 million units, but production dropped about 11 percent to 3 million units compared with data from the same 2006 period.

Per 12-month rolling data, purchases totaled 22 million ties, up a “whopping” 16 percent, RTA said. “Purchases continue to set new RTA records.”

Meanwhile, 12-month tie production, which also totaled 22 million units, increased 10 percent — a more moderated pace that has allowed the inventory-to-sales ratio to “ease down” from 0.84 to 0.72, RTA said.


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