Trade worries shadow rail freight gains

Association of American Railroads Senior Vice President of Policy and Economics John T. Gray.

Another month, another milestone for surging North American rail freight with one caveat – ongoing uncertainty over U.S. trade policy.

United States rail traffic totaled 1,386,026 carloads in August, up 3.8% from August 2017. U.S. railroads originated 1,442,920 containers and trailers, up 5.1%. Combined carload and intermodal originations were 2,828,946, up 4.5% on-year.

In August, 16 of the 20 carload commodity categories tracked by the AAR saw gains from the previous-year period led by petroleum, 28.8%; grain, 19.8%, and chemicals, 7.8%.

Among decliners were nonmetallic minerals, 16.6%; and coal and metallic ores, each weaker by 3.2% for the same month a year ago.

“August was a very good month for U.S. rail traffic with 16 of the 20 carload commodity categories the AAR tracks registering higher carloads in August 2018 than in August 2017, the most since January 2015,” said AAR Senior Vice President of Policy and Economics John T. Gray. “The U.S. economy has been improving since the 2016 slow down. Still a concern, however, trade policy discussions that add a level of uncertainty to future economic growth.”

Excluding coal, monthly carloads were up 7.6%. Excluding coal and grain, carloads were up 6.1%.

Total U.S. carload traffic for the first eight months of 2018 was 9,181,733 carloads, up 1.9% on-year, and 9,704,619 intermodal units, up 6%. Total combined U.S. traffic for the first 35 weeks of 2018 was 18,886,352 carloads and intermodal units, an increase of 4% from 2017.

For the week ending September 1, U.S. rail traffic was 567,881 carloads and intermodal units, up 7.8% compared with the same week in 2017. Volume totaled 280,366 carloads, up 9.6%, while U.S. weekly intermodal volume was 287,515 containers and trailers, up 6%

Nine of the 10 carload commodity groups posted an increase compared with the same week in 2017, topped by petroleum, 60.1%; chemicals, 33.9%, and grain, 24.3%.

Alone among decliners was coal, 2.7% weaker than a year ago.

North American rail volume for the week ending September 1 on 12 reporting U.S., Canadian and Mexican railroads totaled 387,637 carloads, up 8%, and 379,747 intermodal units, up 5.4% from the year-ago week. Total combined weekly traffic was 767,384 carloads and intermodal units, up 6.7%. Volume for the first 35 weeks of 2018 was 25,452,555 carloads and intermodal units, up 3.6% on-year.

Canadian railroads reported 86,902 carloads for the week, up 5.3%, and 72,870 intermodal units, up 4.4%. For the first 35 weeks, Canadian railroads reported cumulative traffic of 5,215,716 carloads, containers and trailers, ahead 3.9%.

Mexican railroads reported 20,369 carloads for the week, down 1.9% from the 2017 week, and 19,362 intermodal units, up 0.6%. Cumulative volume for the first 35 weeks was 1,350,487 carloads and intermodal containers and trailers.