Econintersect: Week 22 of 2015 shows same week total rail traffic (from same week one year ago) contracted according to the Association of American Railroads (AAR) traffic data. Intermodal traffic expanded year-over-year, which accounts for half of movements - but weekly railcar counts continues in contraction. It should be noted that the level of contraction is less than the previous week.

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 which generally are in a weak growth cycle.

A summary of the data from the AAR:

The Association of American Railroads (AAR) today reported U.S. rail traffic for the week ending June 6, 2015.

For this week, total U.S. weekly rail traffic was 550,037 carloads and intermodal units, down 2.2 percent compared with the same week last year.

Total carloads for the week ending June 6, 2015 were 268,722 carloads, down 8.1 percent compared with the same week in 2014, while U.S. weekly intermodal volume was 281,315 containers and trailers, up 4.3 percent compared to 2014.

Four of the 10 carload commodity groups posted an increase compared with the same week in 2014. They included: miscellaneous carloads, up 8 percent to 8,843 carloads; motor vehicles and parts, up 6.2 percent to 19,484; and grain, up 2.6 percent to 18,046 carloads. Commodity groups that posted decreases compared with the same week in 2014 included: coal, down 18.6 percent to 88,346; metallic ores and metals, down 10.5 percent to 24,737 carloads; and nonmetallic minerals, down 4.2 percent to 37,911 carloads.

For the first 22 weeks of 2015, U.S. railroads reported cumulative volume of 6,113,133 carloads, down 3.2 percent from the same point last year; and 5,769,195 intermodal units, up 2.1 percent from last year. Total combined U.S. traffic for the first 22 weeks of 2015 was 11,882,328 carloads and intermodal units, a decrease of 0.7 percent compared to last year.

North American rail volume for the week ending June 6, 2015 on 13 reporting U.S., Canadian and Mexican railroads totaled 359,988 carloads, down 8 percent compared with the same week last year, and 355,553 intermodal units, up 4.3 percent compared with last year. Total combined weekly rail traffic in North America, was 715,541 carloads and intermodal units, down 2.3 percent. North American rail volume for the first 22 weeks of 2015 was 15,511,207 carloads and intermodal units, up 0.2 percent compared with 2014.

Coal is over 1/3 of the total railcar count, and this week is 18% lower than the production estimate in the comparable week in 2014. 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.

[click on graph below to enlarge]

Current Rail Chart:

z rail1.png

From EIA.gov:

For the week ended June 6, 2015:

• Estimated U.S. coal production totaled approximately 15.1 million short tons (mmst)
• This production estimate is 0.4% higher than last week's estimate and 18.0% lower than the production estimate in the comparable week in 2014
• East of the Mississippi River coal production totaled 6.3 mmst
• West of the Mississippi River coal production totaled 8.8 mmst
• U.S. year-to-date coal production totaled 394.0 mmst, 7.9% lower than the comparable year-to-date coal production in 2014