Continuing economic uncertainty, fueled in great measure by ongoing trade disputes and worrisome economic weakness around the globe — combined with low natural gas prices and the shift from coalfired electricity in the United States — to produce another month of disappointing rail traffic in Mexico and the United States, while Canada achieved moderate growth in its intermodal traffic. Carload and intermodal traffic fell by 4.8% and 6.1%, respectively, in the United States in July versus July 2018.
Click on graph for larger image.
This graph from the Rail Time Indicators report shows U.S. average weekly rail carloads (NSA).
Rail carloads have been weak over the last decade due to the decline in coal shipments.
Total carloads originated by U.S. railroads in July 2019 were 1.26 million, down 64,406 carloads (4.8%) from the previous July. Since January’s modest 1.7% increase, U.S. railroads have faced year over-year declines each month — producing a total shortfall of more than 280,000 carloads over the past six months.…
For the year to date, U.S. carloads were 7.82 million in 2019, down 259,574 carloads (3.2%), from the first seven months of 2018. Coal alone was down 158,573 carloads — while crushed stone, sand, and gravel was off by 65,262 carloads, and grain dropped 34,600 carloads (grain mill products fell too, by about 14,000 carloads).
The second graph is for intermodal traffic (using intermodal or shipping containers):
U.S. intermodal originations totaled 1.31 million containers and trailers in July 2019, down 84,878 units from July 2018. The 6.1% decline was the sixth straight monthly decline on a year-over-year basis.
For the first seven months of 2019, intermodal was down 314,125 units (3.7%). Though the decline from 2018 is significant, U.S. intermodal volume through July of this year was higher than every year except 2018 — so the current pace is not as slow as it feels. Intermodal traffic was especially strong during the last five months of 2018, which will make for challenging comps for the remainder of 2019.