IANA reports Q2 intermodal volume gains, with international leading the way

The Intermodal Association of North America (IANA) reported today in its quarterly Intermodal Market Trends & Statistics report that second quarter intermodal volumes had a strong month overall, with annual gains posted for most of its key metrics.

Second quarter total volume—at 4,362,049 containers and trailers— was up 4.5 percent annually, IANA reported. Domestic containers—at 1,690,190—were up 3.5 percent, and international containers—at 2,270,328—were up 6.8 percent. All domestic equipment at 2,091,721—was up 2.2 percent, and trailers dropped 3.1 percent to 401,531.

IANA said that the quarterly growth was paced by international volumes that saw one of its highest increases going back to 2000, when it first began tracking intermodal data. And it explained that while it is “tempting to assume” the international gains were “due to the release of pent-up demand accrued during the port disruptions in Q1,” there is actually more at play in that stronger container import volumes also served as a driver for pushing up international volumes.

On the domestic side, IANA said that the total quarterly domestic growth rate of 2.2 percent represents its lowest growth rate since 2009, with ongoing slowness in trailers partially responsible for the decline along with domestic containers seeing a relatively low 3.5 percent increase.  While domestic volumes were also low in the first quarter of 2014 due to poor winter weather conditions, IANA said that it is not clear why domestic volumes were off during the second quarter of 2015, leaving open the possibility that rail is losing share to trucking or that transloading is losing share in some regions or that the economy is not doing as well as hoped or it could be a seasonal fluke as well.

Despite the low domestic numbers, IANA President and CEO Joni Casey told LM that overall growth for the quarter was in line with projections.

“It’s how we got there that is a bit surprising, [with] higher than anticipated rise in international volumes vs. continued and consistent increases in domestic container shipments,” she said. “Initially, backlog of shipments due to port issues was a driver (for international).  Subsequent increases are too large to be just the result of the backlog and are likely attributed to jump start of economy (finally) and strength of the U.S. dollar stimulating imports.”

Addressing the slumping trailer numbers, Casey explained that intermodal trailer shipments have been in a downward slope for years, with a temporary resurgence at the end of 2013 and beginning of 2014, due to weather related issues and very tight over-the-road trucking conditions.  In all likelihood, Casey said trailers will continue to decrease as a market share of intermodal volumes.

“We have seen weaker domestic container volumes that were tied to the port-slowdown,” she added. “Specifically, transloading tapered off during the periods of port congestion, reducing the number of 53-ft boxes that moved inland. Current softness is a result of increased availability of highway capacity as well as lower fuel prices. A large portion of the growth in domestic containers has been due to highway conversions and it is unrealistic to expect domestic containers to keep growing at the same pace now that they command a higher share of the freight transportation market.”