AAR: U.S. freight rail traffic continues to decline

Combined United States carload and intermodal cargo volumes fell 11.8 percent in April compared with April 2015 and 7.8 percent for the first four months of 2016, according to data from the Association of American Railroads.    United States-based freight railroads in April saw their volumes drop 11.8 percent compared to April 2015, according to data from the Association of American Railroads.
   Carload traffic fell 16.1 percent year-over-year in April to 944,339 carloads, while intermodal volumes slipped 7.5 percent to 1,028,460 containers and trailers.
   Five of the 20 carload commodity categories tracked by the AAR reported growth in April, including miscellaneous carloads, up 25 percent; coke, up 16.1 percent; and chemicals, up 1.5 percent. Commodities that posted year-over-year declines for the month included coal, down 39.7 percent; petroleum and petroleum products, down 25.1 percent; and grain mill products, down 7.1 percent.
   The association noted that excluding coal, volumes of which have plummeted in the past year amid stricter EPA regulations and cheap natural gas, total carload volumes were down 2.8 percent from April 2015. 
   Total U.S. rail traffic volume for the first four months of 2016 has fallen 7.8 percent year-over-year to 8,455,752 carloads and intermodal units. Carload traffic is down 14.3 percent to 4,087,620 carloads, while intermodal containers and trailers are up 0.8 percent to 4,368,132 units compared with the same 2015 period.
   “Rail coal traffic continues to suffer due to low natural gas prices and high coal stockpiles at power plants,” AAR Senior Vice President of Policy and Economics John T. Gray said in a statement. “Coal accounted for just 26 percent of non-intermodal rail traffic for U.S. railroads in April 2016, down from 36 percent in April 2015 and 45 percent as recently as late 2011.
   “We expect non-coal carloads to strengthen when the economy gets stronger, and we think intermodal weakness in April is probably at least partly a function of high business inventories that need to be drawn down before new orders, and thus new shipments, are made.”