April rail volumes fell year-over-year but rose slightly from March 2019, the Association of American Railroads (AAR) said on May 1.
Meanwhile, the AAR predicted that improving economic conditions could lead to rail volumes stabilizing or growing in the second half of the year, although some uncertainties still persist.
Total U.S. rail volumes in April equaled nearly 2.1 million carloads and intermodal units, down 2.4 percent from April 2018. Of that, U.S. railroads originated 1.04 million carloads, which is 0.9 percent lower than April 2018, while intermodal units – containers and trailers – were down 3.9 percent to 1.06 million.
While April’s volumes were down from 2018, they were 3.7 percent higher than March 2019’s total of 2.02 million carloads and intermodal units.
April’s volumes were higher as rail operations in the Midwest, which had been hampered by severe flooding, returned largely to normal, AAR said.
Year-to-date U.S. rail volumes for the first 17 weeks of 2019 were still down compared with the same period in 2018. Year-to-date volumes totaled 8,769,756 carloads and intermodal units, down 1.9 percent from the same period in 2018.
On a weekly basis, total U.S. rail volumes were also lower than the same week in 2018.
For the week ended April 27, U.S. rail volumes totaled 533,190 carloads and intermodal units, down 3.3 percent from the same week in 2018.
While intermodal dragged the total lower, weekly carloads actually grew for the week.
U.S. railroads originated 6.7 percent fewer containers and trailers, at 265,874 intermodal units, while U.S. carloads rose 0.4 percent to 267,316.
Can the U.S. economy lift rail volumes?
Although rail volumes have largely trended lower so far this year, AAR was upbeat that rail volumes could grow if economic conditions remain positive, AAR said.
“It appears that some of the economic uncertainty that was prevalent earlier in the first quarter has dissipated, although concerns about trade issues may still be having an impact on rail volumes,” said John T. Gray, AAR senior vice president of policy and economics.
“However, as long as the economy continues to show life, it’s reasonable to think that rail traffic volumes will continue to improve in the coming months,” Gray said.
Economic factors so far this year appear to be favorable for growth, especially considering that the first quarter was constrained by the U.S government shutdown, the polar vortex and severe flooding in the Midwest.
Housing figures showing upward ticks for home purchases reflect some consumer confidence, according to an analysis of FreightWaves SONAR data. Other indicators such as retail sales and a low U.S. unemployment rate suggest some growth for the remainder of the year, albeit at a potentially slower pace than 2018, according to FreightWaves’ May economic roundup.