Week Ending 26May2012: Surprise, Rail Traffic Grows

May 31st, 2012
in econ_news

Econintersect: Week 21 of 2012 ending 26 May 2012 shows same week rail traffic was slightly above 2011 levels according to data released by the American Association of Railroads (AAR). Excluding coal which is not an economic indicator, rail is expanding 6.8% same week year-over-year.

The main reason for this improvement was due to coal shipments being less bad - with tailwinds from auto shipments and petroleum products

Sixteen of the 20 carload commodity groups posted increases compared with the same week in 2011, with petroleum products, up 51.6 percent; motor vehicles and equipment, up 29.2 percent, grain mill products, up 10.4 percent, and iron and steel scrap, up 10.4 percent. The groups showing a decrease in weekly traffic included grain, down 10 percent, and coal, down 6.3 percent.

Follow up:

A good background article on the switch of the power generating plants from coal to natural gas was published 30May2012 in the NYT.

This is the first out-and-out growth in months.  The majority of the reason for rail contraction is coal movements - which would only effect the profitability of railroads, and not an economic indicator as coal is an alternative fuel to oil and natural gas - U.S. production of those are up sharply in recent months. This week rail growth was strongly positive when coal was removed from the calculation


This Week
Carloads Intermodal Total
This week Year-over-Year 1.3% 4.3% 1.5%
This week without coal
Year Cumulative to Date -3.1% 2.9% -2.3%




Note that the total (cumulative) year-to-date traffic is contracting year-over-year.

Steven Hansen

Source: AAR

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