Week 30 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.

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 8.2 % 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 moved from +10.7 % to +5.7 %

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] ).

A summary for this week from the AAR:

U.S. railroads originated 904,670 carloads in July 2021, up 6.6 percent, or 55,969 carloads, from July 2020. U.S. railroads also originated 1,066,169 containers and trailers in July 2021, up 1.5 percent, or 15,450 units, from the same month last year. Combined U.S. carload and intermodal originations in July 2021 were 1,970,839, up 3.8 percent, or 71,419 carloads and intermodal units from July 2020.

In July 2021, 10 of the 20 carload commodity categories tracked by the AAR each month saw carload gains compared with July 2020. These included: coal, up 31,619 carloads or 14.1 percent; metallic ores, up 14,151 carloads or 137.8 percent; and primary metal products, up 9,802 carloads or 36.4 percent. Commodities that saw declines in July 2021 from July 2020 included: motor vehicles & parts, down 12,309 carloads or 21.3 percent; grain, down 6,112 carloads or 7.3 percent; and grain mill products, down 1,862 carloads or 5 percent.

"U.S. rail traffic in July 2021 was up over July 2020, but the percentage increase was significantly lower than in other recent months, both because of more difficult comparisons and because various external factors have led to a recent deceleration in rail volumes," said AAR Senior Vice President John T. Gray. "For example, grain exports are down sharply, taking rail carloads of grain down with them; automakers are still hampered by semiconductor shortages, leading to sharply lower rail auto volumes; and worldwide supply chain slowdowns are impacting both rail customers and railroads themselves. While all of these should be manageable, temporary setbacks, their convergence has resulted in weaker rail volumes than basic domestic economic factors might otherwise imply."

Excluding coal, carloads were up 24,350 carloads, or 3.9 percent, in July 2021 from July 2020. Excluding coal and grain, carloads were up 30,462 carloads, or 5.6 percent.

Total U.S. carload traffic for the first seven months of 2021 was 6,907,195 carloads, up 9.1 percent, or 573,549 carloads, from the same period last year; and 8,398,236 intermodal units, up 15.2 percent, or 1,109,282 containers and trailers, from last year.

Total combined U.S. traffic for the first 30 weeks of 2021 was 15,305,431 carloads and intermodal units, an increase of 12.4 percent compared to last year.

Week Ending July 31, 2021

Total U.S. weekly rail traffic was 502,540 carloads and intermodal units, up 3 percent compared with the same week last year.

Total carloads for the week ending July 31 were 228,975 carloads, up 5.2 percent compared with the same week in 2020, while U.S. weekly intermodal volume was 273,565 containers and trailers, up 1.2 percent compared to 2020.

Seven of the 10 carload commodity groups posted an increase compared with the same week in 2020. They included metallic ores and metals, up 8,183 carloads, to 24,684; coal, up 3,576 carloads, to 62,965; and nonmetallic minerals, up 2,792 carloads, to 32,356. Commodity groups that posted decreases compared with the same week in 2020 were motor vehicles and parts, down 3,638 carloads, to 12,372; grain, down 2,934 carloads, to 18,231; and farm products excl. grain, and food, down 660 carloads, to 14,928.

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.

[click on the graph below to enlarge]