AAR reports October carloads show annual gains

As was the case in September, the Association for American Railroads (AAR) reported that carload and intermodal volumes in October were up on an annual basis.

October carloads—at 1,215,627—were up 1.7 percent annually. And intermodal—at 975,566 trailers and containers—was up 3.6 percent compared to October 2010. Both categories were also up sequentially, ahead of September’s 1,195,671 carloads and 949,606 trailers and containers.

“While there is clearly room for improvement, October rail traffic appears to indicate that we are still in a slowly growing economy,” said AAR Senior Vice President John T. Gray in a statement. “Rail carloads of many key industrial commodities — chemicals, steel, petroleum products, crushed stone and gravel — are up, and higher rail shipments of autos and intermodal are consistent with a potential pickup on the consumer side of our economy.  Things can change quickly, of course, and the growth rates are certainly not as robust as we would like to see, but we at least appear to be headed in the right direction.”

What’s more October brought about the highest weekly carload total of any month since October 2008, with a weekly average of 303,907 and represents the highest annual percentage increase since March of this year.

On the intermodal side, the weekly average of 243,892 trailers and containers is the highest weekly total since October 2006 and the sixth highest weekly average of any month in history, according to the AAR.

AAR officials noted that October is traditionally the best month for intermodal traffic because it is when retailers do the bulk of their stocking up for the holidays. They added that the “containerization of U.S. rail intermodal service continues its upward trend,” explaining that containers accounted for 86.0 percent of U.S. rail intermodal volume in 2011, down fractionally from September’s 86.1 percent and August’s 86.3 percent. This period, said the AAR, represents a stretch in which never before have containers accounted for such a high percentage of U.S. intermodal traffic.

This sentiment was similar at this month’s RailTrends conference presented by Progressive Railroading magazine and independent industry analyst Tony Hatch.

Both Class I and short line executives noted at RailTrends that intermodal continues to be a major driver for traffic and volume growth.

“Truckload carriers that provide intermodal service are going to the railroads to work on developing [corridors and related projects like terminals], because shippers are asking for it,” said Hatch at RailTrends. “Intermodal is running at a high level of precision.”

For the week ending October 29, the AAR said that U.S. rails moved 307,900 carloads for a 5.2 percent annual gain. This is ahead of the previous two weeks, which hit 301,864 and 303,363, respectively. Carloads on Eastern rails were up 2.3 percent, and volumes were up 7.1 percent out West.

Intermodal for the week ending October 29 reached 243,774 trailers and containers for a 4.6 percent annual improvement. This was slightly below the previous two weeks, which came in at 245,404 and 244,289, respectively.

Of the 20 commodity groups tracked by the AAR, 14 showed weekly gains, with iron and steel scrap up 23.5 percent and petroleum products up 20.5 percent.

On a year-to-date basis, carloads are up 1.8 percent at 12,544,777, and intermodal is up 5.3 percent at 9,856,792.