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posted on 19 January 2018

Rail Week Ending 13 January 2018: A Little Better This Week

Week 2 of 2018 shows same week total rail traffic (from same week one year ago) expanded according to the Association of American Railroads (AAR) traffic data. The rolling averages for the economically intuitive sectors barely remains in expansion, and the decline in the last three weeks negatively affected all the averages.

Analyst Opinion of the Rail Data

We review this data set to understand the economy. If coal and grain are removed from the analysis, this week it grew 0.3 %. We primarily use rolling averages the analyze the data due to weekly volatility.

Intermodal transport expanded year-over-year this week.

The following graph compares the four week moving averages for the rail economically intuitive sectors (red line) vs. total movements (blue line): Rail's intuitive sectors have been bouncing around the zero growth line for most of 2017.

This analysis is looking for clues in the rail data to show the direction of economic activity - and is not necessarily looking for clues of profitability of the railroads. The weekly data is fairly noisy, and the best way to view it is to look at the rolling averages (carloads [including coal and grain] and intermodal combined).

Percent current rolling average is larger than the rolling average of one year ago Current quantities accelerating or decelerating Current rolling average accelerating or decelerating compared to the rolling average one year ago
4 week rolling average -0.2 % decelerating decelerating
13 week rolling average +1.6 % decelerating decelerating
52 week rolling average +3.5 % decelerating decelerating

A summary of the data from the AAR:

For this week, total U.S. weekly rail traffic was 511,937 carloads and intermodal units, up 0.5 percent compared with the same week last year.

Total carloads for the week ending January 13 were 241,351 carloads, down 4.1 percent compared with the same week in 2017, while U.S. weekly intermodal volume was 270,586 containers and trailers, up 5 percent compared to 2017.

Four of the 10 carload commodity groups posted an increase compared with the same week in 2017. They included nonmetallic minerals, up 3,668 carloads, to 30,530; chemicals, up 2,028 carloads, to 31,879; and forest products, up 244 carloads, to 9,748. Commodity groups that posted decreases compared with the same week in 2017 included coal, down 8,992 carloads, to 76,001; grain, down 2,444 carloads, to 21,957; and metallic ores and metals, down 1,443 carloads, to 20,518.

For the first two weeks of 2018, U.S. railroads reported cumulative volume of 449,997 carloads, down 4.6 percent from the same point last year; and 477,802 intermodal units, up 1 percent from last year. Total combined U.S. traffic for the first two weeks of 2018 was 927,799 carloads and intermodal units, a decrease of 1.8 percent compared to last year.

Coal is over 1/3 of the total railcar count, and this week the EIA says coal production is 11.0 % lower than the production estimate in the comparable week in 2017.

The middle row in the table below removes coal and grain from the changes in the railcar counts as neither of these commodities is economically intuitive.

This Week Carloads Intermodal Total
This week Year-over-Year -4.1 % -5.0 % +0.5 %
Ignoring coal and grain -0.3 %
Year Cumulative to Date -4.6 % +1.0 % -1.8 %

[click on graph below to enlarge]

z rail1.png

For the week ended January 13, 2018

  • Estimated U.S. coal production totaled approximately 13.5 million short tons (mmst)
  • This production estimate is 11.7% higher than last week's estimate and 12.9% lower than the production estimate in the comparable week in 2017
  • East of the Mississippi River coal production totaled 5.5 mmst
  • West of the Mississippi River coal production totaled 8 mmst
  • U.S. year-to-date coal production totaled 24.1 mmst, 10.8% lower than the comparable year-to-date coal production in 2017

Steven Hansen



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