U.S. Rail Traffic Down 5.5 Percent in July

The Association of American Railroads (AAR) has reported that total U.S. rail traffic for July 2019 was 2,578,433 carloads and intermodal units, down 5.5 percent or 149,284 carloads and intermodal units compared with July 2018. 

In July 2019, U.S. carload originations totaled 1,264,100, a decrease of 4.8 percent, or 64,406 carloads, compared to July of last year. Excluding coal, carloads for the month were down 2.3 percent, or 20,452 carloads, compared to June 2018. Excluding coal and grain, carloads decreased 2.2 percent, or 16,794 carloads for the month.

Intermodal volume in July 2019 was down 6.1 percent, or 84,878 units. U.S. railroads originated 1,314,333 containers and trailers for the month.

In July 2019, six of the 20 commodity categories tracked by the AAR each month saw increases compared with July 2018. Commodities showing the largest increases included petroleum and petroleum products, up 6,465 carloads or 11.5 percent, and metallic ores up 2,456 carloads, or 7.7 percent.

Coal showed the largest decrease in the commodity groups, with a drop of 43,954 carloads, or 10.3 percent, and crushed stone, sand and gravel declined 6,350 carloads, or 5.1 percent. Primary metal products decreased 4,884 carloads, or 9.9 percent.

“Rail traffic in July, as in many other recent months, was held back by declines in three of the largest rail traffic segments, coal, grain, and intermodal,” said John T. Gray, AAR senior vice president of policy and economics. “Despite a summer heat wave of historical proportions, very low prices for natural gas have seriously weakened the seasonal demand for coal-generated electrical power. These same low natural gas prices appear to have allowed chemical production to pretty much hold steady even in the face of the uncertainty around foreign trade which has been the source of much of the recent growth in chemical production."

“With fifty percent of rail intermodal business which is overseas – including international trade, both imports of consumer and intermediate manufacturing components and exports such as food products – trade policy uncertainty continues to drag down this traffic segment. Export grain movements are also facing increasingly serious headwinds from threats to trade policy stability,” added Gray.

For the week ending August 3, 2019, a decrease of 5.2 percent was reported in total U.S. rail traffic compared with the same week in 2018. Carloads and intermodal units totaled 541,558.