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2021 ‘second-best’ year for US intermodal traffic

AAR: Chemicals set annual record, grain had best year since 2008

U.S. intermodal traffic was at its second best year ever in 2021, while chemicals and grain carloads also grew in 2021. (Photo: Jim Allen:FreightWaves)

The year 2021 managed to be the second-best year for U.S. intermodal volumes, with year-over-year gains in the first half of 2021 offsetting volume losses in the second half of the year, according to data from the Association of American Railroads.

U.S. intermodal traffic totaled 14.1 million intermodal units in 2021, which was 4.9% higher than 2020, according to AAR.

“A record-setting first half gave way to a lower second half as supply chain challenges persisted. Still, 2021 was the second-best U.S. intermodal year ever, behind only 2018,” AAR Senior Vice President John T. Gray said Wednesday.

This SONAR chart shows how U.S. intermodal container volumes in the first half of 2021 (in blue) were higher than previous years. But intermodal container volumes fell in the second half of 2021. (FreightWaves SONAR) To learn more about FreightWaves SONAR, click here.

E-commerce may have lifted intermodal volumes in the first half of the year, but in the second half of the year, labor and equipment shortages contributed to lower intermodal volumes as the railroads struggled to keep pace with the heightened activity. 

“The intermodal network continues to be strained, which has negatively affected turn times and velocity,” said Jason Seidl, transportation director for investment firm Cowen, in a Thursday note about fourth-quarter 2021 volumes and equity share estimates. 

While average train speeds for intermodal trains operated by the U.S. operations of the Class I railroads in 2021 (in blue) were roughly higher than 2019 levels (in green), they were lower than 2020 levels (in orange). Train speeds were higher in 2020 because rail volumes were lower. (FreightWaves SONAR)

Although intermodal volumes trended downward year-over-year in the second half of 2021, U.S. carload volumes in 2021 were consistently higher than 2020 volumes but lower than 2019 volumes, according to FreightWaves SONAR.

Indeed, U.S. carload traffic was 6.6% higher in 2021, totaling 12 million carloads, amid gains for coal, metals and chemicals, among other commodities.

U.S. carload volumes were higher in 2021 (in blue) than 2020 (in green) but lower than 2019 (in orange). (FreightWaves SONAR)

“On the carload side, chemicals set a new annual record and grain had its best year since 2008,” Gray said. 

U.S. chemicals carload volumes were above 2019 and 2020 levels for much of 2021. (FreightWaves SONAR)
Higher grain carloads in the first half of 2021 helped to boost the 2021 yearly total. (FreightWaves SONAR)

“Coal carloads were up substantially because of sharply higher natural gas prices, while carloads of motor vehicles suffered as microchip shortages forced automakers to cut output,” Gray said.

U.S. coal carloads in 2021 were higher than 2020 levels for much of the year amid higher prices for natural gas, a competing fuel for electricity generation. (FreightWaves SONAR)

The lower volumes for motor vehicles and parts carloads in 2021 reflect the chip shortages that the automotive industry faced last year. (FreightWaves SONAR)

U.S. rail volumes combined totaled nearly 26.2 million carloads and intermodal units, a 5.7% increase from 2020.

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The second annual F3: Future of Freight Festival will be held in Chattanooga, “The Scenic City,” this November. F3 combines innovation and entertainment — featuring live demos, industry experts discussing freight market trends for 2024, afternoon networking events, and Grammy Award-winning musicians performing in the evenings amidst the cool Appalachian fall weather.

Joanna Marsh

Joanna is a Washington, DC-based writer covering the freight railroad industry. She has worked for Argus Media as a contributing reporter for Argus Rail Business and as a market reporter for Argus Coal Daily.