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11/2/2012



Rail News: Rail Industry Trends

AAR: U.S. carloads tumbled more steeply in October's last full week


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U.S. carloads have been weak for much of 2012, but they were particularly soft in the week ending Oct. 27. In that period, U.S. railroads originated 287,104 carloads, down 7 percent compared with the same week last year, according to the Association of American Railroads.

Weekly carload volume was down 5.7 percent in the East and 7.8 percent in the West, and only nine of 20 commodity groups posted gains, led by farm products excluding grain (72 percent) and petroleum products (52.7 percent). Iron and steel scrap loads tumbled 32.8 percent, grain volume fell 19 percent and coal carloads declined 15.2 percent.

At least intermodal volume continued a year-long ramp up. For the week ending Oct. 27, U.S. containers and trailers totaled 253,186 units, up 3.9 percent year over year.

Highway-to-intermodal conversion opportunities continue to drive growth in domestic intermodal, said Robert W. Baird & Co. Inc. analysts in their weekly "Rail Flash" report. On Oct. 28, Union Pacific Railroad announced it was implementing surge volume surcharges because container capacity was again constrained in southern California, they said.

"UP also experienced southern California capacity constraints in late September to early October, corresponding with firming in broader freight trends," Baird analysts said.

Meanwhile, Canadian railroads reported 81,679 carloads for the week, up 1.4 percent, and 54,847 containers and trailers, up 6.2 percent. Mexican railroads' weekly carloads climbed 6.2 percent to 14,771 units and intermodal volume leaped 56.3 percent to 11,129 units.

Through 2012's first 43 weeks, 13 reporting U.S., Canadian and Mexican railroads handled 16,126,785 carloads, down 1.7 percent, and 12,876,326 containers and trailers, up 4.7 percent compared with the same period last year.


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