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Rail News: Rail Industry Trends

Tie purchases and production up dramatically in May, RTA says

There are leaps and there are dramatic leaps. Last month, crosstie purchases and production accomplished the latter compared with April data, according to the Railway Tie Association’s (RTA) monthly market report. Purchases totaling 2.7 million units and production totaling 2.4 million units each rose about 38 percent on a month-over-month basis.

Tie inventories decreased by 269,000 units, or 1.7 percent, to 15.7 million units and the inventory-to-sales ratio dropped by 0.7 points to 0.77 compared with April — the ratio’s biggest one-month decline in about nine years, RTA said.

During 2006’s first five months, tie purchases totaled 9.5 million units, up about 20 percent, and production totaled 9.7 million units, up about 40 percent compared with the same 2005 period.

Twelve-month rolling totals showed purchases reached 20.3 million units and production totaled 22 million units. The tie inventory rose 12 percent compared with May 2005.

“Purchases continue to set new records … and are growing at a fantastic 10 percent pace,” RTA officials said in the report. “Production is racing ahead at an amazing 20 percent [clip] and has reached levels not seen since the RTA started collecting data [in 1987].”

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More News from 6/21/2006