Rail Week Ending April 14: Rail Growth Positive With Mostly Positive Trends
Week 15 of 2018 shows same week total rail traffic (from same week one year ago) improved according to the Association of American Railroads (AAR) traffic data. The rolling averages growth rates are generally improving.
Analyst Opinion of the Rail Data
We review this data set to understand the economy. If coal and grain are removed from the analysis for carloads, this week it expanded 5.9 %. We primarily use rolling averages the analyze the data due to weekly volatility - and the 4-week rolling averages declined to 2.0 %.
Intermodal transport growth remains strong year-over-year.
The following graph compares the four-week moving averages for carload economically intuitive sectors (red line) vs. total movements (blue line):
Although rail's growth rate is improving - it has yet to show that the economy is getting ready for a growth spurt.
This analysis is looking for clues in the rail data to show the direction of economic activity - and is not necessarily looking for clues of profitability of the railroads. The weekly data is fairly noisy, and the best way to view it is to look at the rolling averages (carloads [including coal and grain] and intermodal combined).
| Percent current rolling average is larger than the rolling average of one year ago | Current quantities accelerating or decelerating | Current rolling average accelerating or decelerating compared to the rolling average one year ago | |
| 4 week rolling average | +1.6 % | decelerating | decelerating |
| 13 week rolling average | +2.0 % | accelerating | accelerating |
| 52 week rolling average | +2.7 % | accelerating | unchanged |
A summary of the data from the AAR:
For this week, total U.S. weekly rail traffic was 534,198 carloads and intermodal units, up 4.3 percent compared with the same week last year.
Total carloads for the week ending April 14 were 258,123 carloads, up 1.6 percent compared with the same week in 2017, while U.S. weekly intermodal volume was 276,075 containers and trailers, up 6.9 percent compared to 2017.
Nine of the 10 carload commodity groups posted an increase compared with the same week in 2017. They included motor vehicles and parts, up 2,609 carloads, to 18,838; metallic ores and metals, up 2,174 carloads, to 24,785; and nonmetallic minerals, up 1,420 carloads, to 37,834. One commodity group posted a decrease compared with the same week in 2017: coal, down 6,265 carloads, to 75,778.
For the first 15 weeks of 2018, U.S. railroads reported cumulative volume of 3,816,220 carloads, up 0.2 percent from the same point last year; and 4,035,463 intermodal units, up 5.4 percent from last year. Total combined U.S. traffic for the first 15 weeks of 2018 was 7,851,683 carloads and intermodal units, an increase of 2.8 percent compared to last year.
Coal is over 1/3 of the total railcar count, and this week the EIA says coal production is 9.4 % lower than the production estimate in the comparable week in 2017.
The middle row in the table below removes coal and grain from the changes in the railcar counts as neither of these commodities is economically intuitive.
| This Week | Carloads | Intermodal | Total |
| This week Year-over-Year | +1.6 % | +6.9 % | +4.3 % |
| Ignoring coal and grain | +5.9 % | ||
| Year Cumulative to Date | +0.2 % | +5.4 % | +2.8 % |
For the week ended April 14, 2018
- Estimated U.S. coal production totaled approximately 13.3 million short tons (mmst)
- This production estimate is 7% lower than last week's estimate and 9.4% lower than the production estimate in the comparable week in 2017
- East of the Mississippi River coal production totaled 5.4 mmst
- West of the Mississippi River coal production totaled 7.8 mmst
- U.S. year-to-date coal production totaled 218.6 mmst, 2.8% lower than the comparable year-to-date coal production in 2017
Disclosure: None.
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