Week 26 of 2018 shows same week total rail traffic (from same week one year ago) improved according to the Association of American Railroads (AAR) traffic data.
Analyst Opinion of the Rail Data
We review this data set to understand the economy. If coal and grain are removed from the analysis for carloads, this week it expanded 4.0 %. We primarily use rolling averages the analyze the data due to weekly volatility - and the 4 week rolling average for the intuitive sectors declined from 4.0 % to 3.8 %. Year-over-Year economic growth in 1Q2018 was 2.8 %.
Intermodal transport growth remains strong year-over-year.
The following graph compares the four-week moving averages for carload economically intuitive sectors (red line) vs. total movements (blue line).
Although rail's growth rate is improving (and is better than GDP growth) - it has yet to confirm that the economy is getting ready for a growth spurt.
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 | +2.7 % | accelerating | accelerating |
| 13 week rolling average | +3.3 % | accelerating | accelerating |
| 52 week rolling average | +2.3 % | accelerating | unchanged |
A summary of the data from the AAR:
U.S. railroads originated 1,080,769 carloads in June 2018, up 2.0 percent, or 21,098 carloads, from June 2017. U.S. railroads also originated 1,159,973 containers and trailers in June 2018, up 6.3 percent, or 68,689 units, from the same month last year. Combined U.S. carload and intermodal originations in June 2018 were 2,240,742, up 4.2 percent, or 89,787 carloads and intermodal units from June 2017.
In June 2018, 14 of the 20 carload commodity categories tracked by the AAR each month saw carload gains compared with June 2017. These included: petroleum & petroleum products, up 7,411 carloads or 19.7 percent; crushed stone, sand & gravel, up 7,276 carloads or 7.1 percent; and chemicals, up 4,608 carloads or 3.7 percent. Commodities that saw declines in June 2018 from June 2017 included: coal, down 9,396 carloads or 2.7 percent; nonmetallic minerals, down 3,552 carloads or 18.8 percent; and waste & nonferrous scrap, down 618 carloads or 3.8 percent.
"Rail traffic in June was consistent with a healthy economy," said AAR Senior Vice President of Policy and Economics John T. Gray. "In June, 14 of the 20 commodity categories the AAR tracks each month saw carload gains — the third straight month in which at least 14 categories were up. That's the longest such streak since late 2014. Meanwhile, record intermodal volume for June speaks to the high value proposition that rail customers associate with intermodal service. For now, things are looking good for the railroads and the economy despite the many threats, such as a potential trade war, that could bring change quickly."
Excluding coal, carloads were up 30,494 carloads, or 4.3 percent, in June 2018 from June 2017. Excluding coal and grain, carloads were up 25,979 carloads, or 4.2 percent.
Total U.S. carload traffic for the first six months of 2018 was 6,747,414 carloads, up 1.3 percent, or 87,169 carloads, from the same period last year; and 7,153,557 intermodal units, up 6.0 percent, or 405,633 containers and trailers, from last year.
Total combined U.S. traffic for the first 26 weeks of 2018 was 13,900,971 carloads and intermodal units, an increase of 3.7 percent compared to last year.
Week Ending June 30, 2018
Total U.S. weekly rail traffic was 564,243 carloads and intermodal units, up 4.6 percent compared with the same week last year.
Total carloads for the week ending June 30 were 270,916 carloads, up 0.7 percent compared with the same week in 2017, while U.S. weekly intermodal volume was 293,327 containers and trailers, up 8.5 percent compared to 2017.
Eight of the 10 carload commodity groups posted an increase compared with the same week in 2017. They included petroleum and petroleum products, up 2,494 carloads, to 11,354; chemicals, up 1,739 carloads, to 33,563; and metallic ores and metals, up 738 carloads, to 26,054. Commodity groups that posted decreases compared with the same week in 2017 were coal, down 4,635 carloads, to 83,214; and grain, down 7 carloads, to 23,433.
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 | +0.7 % | +8.5 % | +4.6 % |
| Ignoring coal and grain | +3.9 % | ||
| Year Cumulative to Date | +1.3 % | +6.9 % | +3.7 % |
[click on graph below to enlarge]
z rail1.png
For the week ended June 30, 2018
- Estimated U.S. coal production totaled approximately 14.6 million short tons (mmst)
- This production estimate is 0.3% higher than last week's estimate and 6.2% lower than the production estimate in the comparable week in 2017
- East of the Mississippi River coal production totaled 5.9 mmst
- West of the Mississippi River coal production totaled 8.7 mmst
- U.S. year-to-date coal production totaled 375.4 mmst, 2.3% lower than the comparable year-to-date coal production in 2017
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