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Rail News: Rail Industry Trends

RTA report: Tie purchases and production tumble in September, but continue to outpace 2005 totals


Following seasonal patterns, September crosstie purchases decreased 7 percent to 1.7 million units and production fell 9 percent to 2 million units compared with August, according to the Railway Tie Association’s (RTA) monthly market activity report.

However, tie inventories rose 2 percent to 16.3 million units and the inventory-to-sales ratio edged up to 0.78 compared with August’s 0.77 ratio — the third-straight monthly gain.

During the third quarter, tie purchases totaled 5 million units and production totaled 5.7 million units.

“On the heels of a sensational second quarter, third-quarter purchases relaxed, falling more in line with recent activity,” RTA officials said in the report. “But purchases were still 8 percent above last year and 8 percent above the previous five years’ average.”

Through 2006’s fist nine months, tie purchases totaling 16.6 million units increased 16 percent and production totaling 17.4 million units rose 24 percent compared with similar 2005 data.

Twelve-month rolling totals show purchases totaling 21 million units, up 16 percent, and production totaling 22.6 million units, up 23 percent, RTA said. The inventory-to-sales ratio held steady at 0.78.

“Annualized purchases looked to have hit a ceiling during the past few months, but this September’s activity demonstrates continued growth,” RTA officials said.

Contact Progressive Railroading editorial staff.

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