U.S. freight rail traffic in Week 3 (ending Jan. 21, 2023) dipped 2.1% from the prior-year period, the Association of American Railroads (AAR) reported Jan. 25. Traffic trailed the same period in 2019 by 14%, according to Susquehanna Financial Group (SFG) Analyst Bascome Majors.
For the week ending Jan. 21, 2023, total U.S. weekly rail traffic came in at 467,485 carloads and intermodal units, comprising 236,940 containers and trailers (down 6.7% from the same week in 2022) and 230,545 carloads (up 3.3% from 2022), AAR reported.
The Chinese New Year holiday falls “within AAR-reported Week 4 of 2023 (Jan. 22), the earliest since 2004,” Bascome Majors wrote in The Rail Report—Week 3 on Jan. 25. “As a result of the holiday timing difference and an assumption of a 3-4 week lag of the holiday’s impact on North American intermodal networks, we expect to see a year-over-year comp-driven headwind in AAR Week 7 or 8 as Chinese New Year-impacted intermodal volumes comp against a ‘super-seasonal’ 2022 week that is less burdened for the Chinese New Year. We expect the declines to be exacerbated vs. last year’s uniquely difficult comp as the massive near-100 ship backlog (at anchor plus slow-steaming from Asia) at Southern California ports conflated any sort of typical seasonality following the Chinese New Year. Additionally in China, the 2023 Chinese New Year is the first since easing of COVID-policies, allowing freer movement of citizens across the country to return to rural areas for the holiday after constraining that opportunity in 2020-2022. As early as week 10, we expect year-over-year volume trends to be past Chinese New Year-related distortions and land at more normalized levels reflecting underlying demand (which isn’t particularly strong right now), although we’ll closely watch for effects of China’s continued economic reopening on port and intermodal volumes as the year continues.”
Week Ending Jan. 21, 2023
For the week ending Jan. 21, 2023, five of the 10 carload commodity groups posted an increase over the same week in 2022, according to AAR. They included nonmetallic minerals, up 5,895 carloads, to 31,264; coal, up 2,454 carloads, to 68,675; and motor vehicles and parts, up 2,321 carloads, to 13,166. Commodity groups that posted decreases included chemicals, down 2,891 carloads, to 31,038; grain, down 1,262 carloads, to 22,015; and forest products, down 799 carloads, to 9,065.
For the first three weeks of 2023, U.S. railroads reported cumulative volume of 687,678 carloads, a 3% rise from the same point last year; and 682,296 intermodal units, an 8.4% fall-off from last year. Total combined U.S. traffic for the first three weeks of 2023 was 1,369,974 carloads and intermodal units, dropping 3% from 2022.
North American rail volume for the week ending Jan. 21, 2023, on 12 reporting U.S., Canadian and Mexican railroads totaled 336,113 carloads, a 6.8% gain from the same week last year, and 309,502 intermodal units, a 6.7% drop from last year. Total combined weekly rail traffic in North America was 645,615 carloads and intermodal units, down 0.1%. North American rail volume for the first three weeks of 2023 was 1,893,180 carloads and intermodal units, down 0.5% from 2022.
Canadian railroads reported 82,940 carloads for the week ending Jan. 21, 2023, a 20.2% boost over the same week in 2022, and 56,839 intermodal units, a 7.9% decline from last year. For the first three weeks of 2023, they reported cumulative rail traffic volume of 413,325 carloads, containers and trailers, up 8.7%.
Mexican railroads reported 22,628 carloads for the week ending Jan. 21, 2023, up 0.7% compared with the same week last year, and 15,723 intermodal units, down 1.1%. Their cumulative volume for the first three weeks of 2023 was 109,881 carloads and intermodal containers and trailers, up 0.3% from the same week in 2022.