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Rail News: Rail Industry Trends

AAR: Coronavirus impact on February rail traffic 'limited'


Despite uncertainty over the potential economic effects of the COVID-19 outbreak, the impact on rail traffic so far has been limited, the Association of American Railroads (AAR) announced yesterday.

Last month's 8.1 percent decline in U.S. freight rail traffic compared with February 2019 levels was primarily due to a reduction in coal carloads, said AAR Senior Vice President John Gray in a press release.

Railroads transported 1,924,767 carloads and intermodal units in February. Total carloads fell 7.3 percent to 927,084 units, while intermodal volume slipped 8.9 percent to 997,683 containers and trailers compared with year-ago figures, according to AAR data.

"Excluding coal, carloads in February were down just 0.8 percent, their best showing in a year,” said Gray. “In February, 10 of the 20 commodity categories we track saw year-over-year carload gains, the most in more than a year."

Among the 10 carload commodity groups that posted gains last month were chemicals, up 3,718 carloads or 2.9 percent; petroleum and petroleum products, up 3,488 carloads or 7.2 percent; and all other carloads, up 2,875 carloads or 12 percent.

Commodities that logged decreases included coal, down 67,770 carloads or 21.1 percent; crushed stone, sand & gravel, down 10,557 carloads or 12.5 percent; and grain, down 5,350 carloads or 6.4 percent.

"There’s a huge amount of uncertainty regarding the coronavirus situation, but to date the impact on U.S. rail traffic appears limited. That could change if, for example, sharp declines projected by U.S. ports occur in the weeks ahead,” said Gray.

Supply chain disruptions related directly or indirectly to the coronavirus may have played some unquantifiable role in the decline in U.S. intermodal volumes last month, but intermodal has been falling for more than a year,  he said.

"The headwinds facing railroads that pre-date the virus include lingering trade impacts and economic uncertainty; severe winter weather in parts of the country; blockades in Canada that shut down rail traffic there and impacted domestic traffic, too," said Gray.

Total U.S. traffic for the first two months of 2020 was 2,092,817 carloads, down 6.5 percent from the same period last year, and 2,242,763 intermodal units, down 7 percent.