Written by Steven Hansen
Econintersect publishes Association of American Railroads (AAR) weekly traffic reports on Thursdays, and this post provides a monthly overview showing rail movements for April 2012 compared to April 2011. In general, rail traffic was “less bad” – and the bad caused almost entirely by coal’s biggest year-over-year percentage decline on record.
- carloads down 5.5% year-over-year (compared to down 5.8% last month)
- intermodal (containers or trailers on railcars) up 3.6% year-over-year (compared to up 3.5% last month).
- total carloads plus intermodal down 1.5% year-over-year (compared to down 1.8% last month).
Econintersect uses rail movements to add to understanding of economic dynamics in coming months. As long as growth remains positive, it bodes well for a positive economic outlook.
As coal comprises well over 40% of all commodities transported, and coal has major demand fluctuations unassociated with the economy – the below graph removes coal from the equation – and shows a 3.2% gain year-over-year.
The AAR highlighted in their report that it is not only coal which is causing the data wobble, but also grains (whose decline in transport also has little to do with economic drivers – only the profitability of the railroads).
The graphic below compares non-seasonally adjusted total rail movements year-over-year.
Most finished consumer goods which travel on rail move in intermodal units, containers and trailers, on rail cars. If there was only one pulse point to watch – it is this one. It shows positive (and weak) year-over-year growth. A caveat here: this needs to be viewed with trucking data to get a complete picture – as this same service is provided by both modes of transport.
Rail is one of the first reporters of April 2012 data. So far other major transport indicators are mixed but the transport data overall is showing weak growth:
- Truck Transport (March 2012): Up 2.7% year-over-year
- Rail (March 2012): Down 1.8% year-over-year
- Rail (April 2012): Down 1.5% year-over-year
- Container Counts (March 2012): exports increased 12.9%, while imports increased 2.5% year-over-year.
Only import container counts are economically intuitive. For sure, the economy is not in a strong growth cycle so far in 2012 as the transport numbers are anemic – but not recessionary.