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Rail News: Rail Industry Trends

'Tis the season for tie purchases to plummet in November, RTA says

After rising 34 percent in October, North American crosstie purchases fell 12 percent in November to 1.57 million units, following a typical seasonal pattern, according to the Railway Tie Association’s (RTA) monthly market report. However, purchases rose 27 percent compared with November 2004.

November tie production increased slightly to 1.79 million units compared with October. Tie inventories rose 213,000 units to 14.9 million.

During 2005’s first 11 months, tie purchases totaling 17.7 million units rose 7 percent, but production totaling 17.6 million units dropped 2 percent compared with the same 2004 period.

“Purchases have exceeded production all year,” RTA officials said in the report. “Compared to the year-to-date averages from the past five years, purchases were up 16 percent and production was up 14 percent.”

Rolling 12-month data shows tie purchases reached 18.9 million units — the highest level since March 1998 — while production rose slightly to 19 million units. The inventory-to-sales ratio held steady at 0.79.

“Purchases are growing at a 5 percent clip,” RTA said. “Production has eased off 1.5 percent from the prior year’s stellar performance.”

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More News from 12/22/2005