Written by Steven Hansen
Week 26 of 2021 shows the same week total rail traffic (from the same week one year ago) improved according to the Association of American Railroads (AAR) traffic data. Total rail traffic is now showing strong year-over-year growth as it is being compared to the recession period one year ago.
Analyst Opinion of the Rail Data
Total rail traffic has two components – carloads and intermodal (containers or trailers on rail cars). This week again both carloads and intermodal continued in expansion year-over-year – with the rate of acceleration of growth slowing.
We review this data set to understand the economy. The intuitive sectors (total carloads removing coal, grain, and petroleum) expanded 28.0 % 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 improved from +16.0 % to +18.9 %
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):
.
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 | +14.9 % | improving |
| 13 week rolling average | +22.9 % | slowing |
| 52 week rolling average | +5.8 % | improving |
A summary for this week from the AAR:
U.S. railroads originated 1,175,232 carloads in June 2021, up 19.1 percent, or 188,164 carloads, from June 2020. U.S. railroads also originated 1,386,745 containers and trailers in June 2021, up 10.9 percent, or 136,634 units, from the same month last year. Combined U.S. carload and intermodal originations in June 2021 were 2,561,977, up 14.5 percent, or 324,798 carloads and intermodal units from June 2020.
In June 2021, 19 of the 20 carload commodity categories tracked by the AAR each month saw carload gains compared with June 2020. These included: coal, up 84,109 carloads or 33.5 percent; chemicals, up 22,660 carloads or 16 percent; and metallic ores, up 20,228 carloads or 164.6 percent. It was farm products excluding grain, down 425 carloads or 10.6 percent.
“U.S. rail volumes in the second quarter of 2021 reflect an economy that is in much better shape than it was but still has room to grow,” said AAR Senior Vice President John T. Gray. “In the second quarter, total U.S. carloads were the highest since the fourth quarter of 2019; carloads excluding coal were the highest since the third quarter of 2019; and intermodal and chemical volumes were both the highest for any quarter in history. Carloads of steel-related commodities were also relatively strong in the second quarter, reflecting higher demand as the industrial economy continues to recover.”
Excluding coal, carloads were up 104,055 carloads, or 14.1 percent, in June 2021 from June 2020. Excluding coal and grain, carloads were up 100,564 carloads, or 15.9 percent.
Total U.S. carload traffic for the first six months of 2021 was 6,002,525 carloads, up 9.4 percent, or 517,580 carloads, from the same period last year; and 7,332,067 intermodal units, up 17.5 percent, or 1,093,832 containers and trailers, from last year.
Total combined U.S. traffic for the first 26 weeks of 2021 was 13,334,592 carloads and intermodal units, an increase of 13.7 percent compared to last year.
Week Ending July 3, 2021
Total U.S. weekly rail traffic was 512,919 carloads and intermodal units, up 17.1 percent compared with the same week last year.
Total carloads for the week ending July 3 were 236,846 carloads, up 22.8 percent compared with the same week in 2020, while U.S. weekly intermodal volume was 276,073 containers and trailers, up 12.6 percent compared to 2020.
Nine of the 10 carload commodity groups posted an increase compared with the same week in 2020. They included coal, up 17,570 carloads, to 66,380; metallic ores and metals, up 9,419 carloads, to 23,185; and chemicals, up 6,179 carloads, to 34,869. One commodity group posted a decrease compared with the same week in 2020: grain, down 794 carloads, to 19,863.
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 | +22.8 % | +12.6 % | +17.1 % |
| — Ignoring coal, grain & petroleum | +28.0 % | ||
| Year Cumulative to Date | +9.4 % | +17.5 % | +13.7 % |
[click on the graph below to enlarge]
z rail1.png
include(“/home/aleta/public_html/files/ad_openx.htm”); ?>
![[click on the graph below to enlarge]](/images/z%20rail1.png?v=36){kind=link}