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10/21/2005



Rail News: Rail Industry Trends

Crosstie purchases down, production up in the third quarter, RTA says


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After dipping slightly in August, North American crosstie purchases dropped 19 percent in September to 1.32 million units compared with the previous month, according to a Railway Tie Association (RTA) report.

August tie production rose 17 percent to 1.86 million units and September production increased 1 percent to 1.88 million units compared with the previous months. Tie inventories rose by more than 750,000 units to 14.7 million ties during the two months.

During the third quarter, tie production totaled 5.3 million units and purchases reached 4.6 million units, a 13 percent increase and 10 percent decrease, respectively, compared with the second quarter.

“[However], third-quarter purchases were still 4.5 percent higher than the average of third quarters from the past five years,” RTA officials said in the report.

During 2005’s first nine months, tie purchases totaling 14.3 million units rose 2.3 percent, but production totaling 14 million units dropped 6 percent compared with 2004’s first nine months.

“Purchases have exceeded production by 2 percent,” RTA officials said. “Compared to the year-to-date averages from the past five years, purchases were up 10 percent and production was up 12.6 percent.”

Rolling 12-month data shows tie purchases falling slightly to 18.1 million units and production rising slightly to 18.4 million units compared with the previous 12-month period. The inventory-to-sales ratio increased to 0.81.

“Purchases are barely growing at 0.4 percent,” RTA officials said. “Growth has been impressive since mid-2003, but purchases flattened out in May of this year.”


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