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Rail News Home Rail Industry Trends

11/4/2008



Rail News: Rail Industry Trends

RTA's September report: 'Tis the season for tie purchase, production drop-off


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In September, crosstie purchases and production declined from August levels, following normal seasonal patterns, according to the Railway Tie Association’s (RTA) monthly crosstie market report. Purchases totaling 1.6 million units decreased 13.7 percent and production totaling 1.7 million units fell 2.4 percent.

However, tie inventories inched up 1 percent to 14.7 million units, the first month-over-month increase since January, RTA said.

In the third quarter, purchases declined 8.3 percent to 5.21 million units and production decreased 1.7 percent to 5.24 million units vs. third-quarter 2007 totals — the first time quarterly purchases lagged production in more than one year, indicating a “move toward balance between supply and demand,” the report states.

Through 2008’s first nine months, purchases increased 5.1 percent to 16.6 million units, but production dropped 6.5 percent to 14.6 million units compared with totals from the same 2007 period.

Twelve-month rolling data shows production remains in a “gentle slide” from the summer of 2006’s highs, RTA said. Production, which declined 5.6 percent to 19.5 million units, has moderated to an annual growth rate of 2.8 percent, the report states.

Meanwhile, inventories decreased 10 percent in the 12-month period, dropping the inventory-to-sales ratio to 0.7 vs. a 0.8 rolling data ratio that’s been in place the past five years, RTA said.


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