Written by Steven Hansen
Week 53 of 2020 shows same week total rail traffic (from the same week one year ago) improved according to the Association of American Railroads (AAR) traffic data [note that there was no week 53 last year). Total rail traffic has been mostly in contraction for over one year – and now is slowly recovering from the coronavirus pandemic.
Analyst Opinion of the Rail Data
Total rail traffic has two components – carloads and intermodal (containers or trailers on rail cars). Container exports from China have recovered, container exports from the U.S. remain deep in contraction. This week again intermodal continued in expansion year-over-year and continues on a strengthening trendline.
Carloads 4 week rolling average is in expansion when compared to the 4 week rolling average one year ago but the economic intuitive sectors remain in contraction.
But overall because of the strength of intermodal, rail is growing year-over-year.
We review this data set to understand the economy. The intuitive sectors (total carloads removing coal, grain, and petroleum) contracted 4.3 % year-over-year for this week. We primarily use rolling averages to analyze the intuitive data due to weekly volatility – and the 4 week rolling year-over-year average for the intuitive sectors worsened from -4.1 % to 5.0 %
When rail contracts, it suggests a slowing of the economy.
The following graph compares the four-week moving averages for carload economically intuitive sectors (red line) vs. total movements (blue line):
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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 the 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] ).
| Percent current rolling average change from the rolling average of one year ago | Trend Direction | |
| 4 week rolling average | +4.2 % | improving |
| 13 week rolling average | +3.2 % | worsening |
| 52 week rolling average | -7.3 % | improving |
A summary for this week from the AAR:
U.S. railroads originated 1,101,324 carloads in December 2020, down 3.7 percent, or 42,666 carloads, from December 2019. U.S. railroads also originated 1,334,495 containers and trailers in December 2020, up 12.2 percent, or 145,126 units, from the same month last year. Combined U.S. carload and intermodal originations in December 2020 were 2,435,819, up 4.4 percent, or 102,460 carloads and intermodal units from December 2019.
In December 2020, 10 of the 20 carload commodity categories tracked by the AAR each month saw carload gains compared with December 2019. These included: grain, up 28,095 carloads or 27.9 percent; chemicals, up 5,764 carloads or 3.7 percent; and iron & steel scrap, up 1,913 carloads or 12.9 percent. Commodities that saw declines in December 2020 from December 2019 included: coal, down 50,509 carloads or 14.5 percent; crushed stone, sand & gravel, down 12,333 carloads or 14.8 percent; and petroleum & petroleum products, down 10,386 carloads or 15.8 percent.
“Before the pandemic even hit, railroads began 2020 on less than ideal footing because of weakness in the manufacturing sector and lower port activity caused by trade disputes,” said AAR Senior Vice President John T. Gray. “For several months earlier this year, railroads suffered near-record traffic declines, but they worked hard to keep the goods we all need moving. By the end of the year, rail traffic was close to pre-pandemic levels, sparked by sharply higher grain and intermodal shipments along with the reopening of auto assembly plants.”
“It’s no surprise that rail volumes were down for the year overall, but railroads are looking to the future,” Gray added. “Their experience in 2020 along with huge ongoing network investments have made the industry more adaptable and better able to adjust to the demands of a wide range of operational and market conditions. Railroads are well prepared to help our economy grow in 2021.”
Excluding coal, carloads were up 7,843 carloads, or 1.0 percent, in December 2020 from December 2019. Excluding coal and grain, carloads were down 20,252 carloads, or 2.9 percent.
Total U.S. carload traffic for the first 12 months of 2020 was 11,482,059 carloads, down 12.9 percent, or 1,705,963 carloads, from the same period last year; and 13,675,417 intermodal units, down 1.8 percent, or 255,634 containers and trailers, from last year.
Total combined U.S. traffic for the first 53 weeks of 2020 was 25,157,476 carloads and intermodal units, a decrease of 7.2 percent compared to last year.
Week Ending January 2, 2021
Update: Because of the way the days fell in 2020, there were 53 Weekly Railroad Traffic reports for 2020. Year-over-year weekly comparisons are always made to the week that was 52 weeks earlier, therefore, week 53, 2020 ending on January 2, 2021 will be compared to week 1, 2020 ending on January 4, 2020.
For cumulative comparisons, 2020 will include week 1 to week 53, 2020 and will be compared to the period from week 1, 2019 to week 1, 2020 ending on January 4, 2020.
Total U.S. weekly rail traffic was 421,991 carloads and intermodal units, up 1.9 percent compared with the same week last year.
Total carloads for the week ending January 2 were 202,278 carloads, down 6.1 percent compared with week 1 in 2020, while U.S. weekly intermodal volume was 219,713 containers and trailers, up 10.7 percent compared to week 1 in 2020.
Five of the 10 carload commodity groups posted an increase compared with week 1 in 2020. They included grain, up 5,209 carloads, to 24,790; motor vehicles and parts, up 1,604 carloads, to 8,619; and chemicals, up 557 carloads, to 31,560. Commodity groups that posted decreases compared with week 1 in 2020 included coal, down 14,805 carloads, to 55,018; nonmetallic minerals, down 3,043 carloads, to 19,773; and petroleum and petroleum products, down 2,791 carloads, to 10,266.
The middle row in the table below removes coal, grain, and petroleum from the changes in the railcar counts as these commodities are not economically intuitive.
| This Week | Carloads | Intermodal | Total |
| This week Year-over-Year | -6.1 % | +10.7 % | +1.9 % |
| — Ignoring coal, grain & petroleum | -4.3 % | ||
| Year Cumulative to Date | -12.9 % | -1.8 % | -7.2 % |
[click on the graph below to enlarge]
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