A brief look at railroad freight traffic numbers offers some tell-tale signs as to where our economy is heading. I like to review railroad loading statistics because they can give you a crystal-ball edge in guessing where the big money is leaning in the volatile economic food chain. Basically, right now the numbers are firm year over year, but the freight demographics are what I find interesting.
According to the Association of American Railroads: Total rail freight volume is up 8.9% as compared to 2006, but while container volume is up about 14%, trailer volume is down 6.2%. That indicates that for the year so far, the railroads are probably moving more imported product than domestic product.
While total carload freight (not including inter-modal) was down nearly 1% this week as compared to the same week last year, total ton-miles increased 0.3%, indicating that less freight is moving but it is traveling more miles. That is clearly due to the decreasing inventories of manufactured product, which should bode well for manufacturers in the second and third quarters. That's assuming that consumer spending maintains current levels.
Nonmetallic mineral shipments have increased nearly 20% by volume over last year. This shows strength in base chemicals, base raw materials, glass, concrete, asphalt, industrial construction, and infrastructural improvements. Metallic ore shipments are down over 50%; I believe that shows weakness most especially in steel, tin, aluminum, and copper. Lumber and wood product shipments declined nearly 25% -- no reprieve for the home building market there! Petroleum product shipments are up 9.2% year over year, and coal shipments have increased 3.1%. Here's a tip, it looks like road building and resurfacing will be a big gainer this summer!
Canadian rail shipments are down slightly year to year, showing declines of 4.3% for shipment originations and a 0.2% decrease in containers and trailers. Mexican rail traffic on the Mexican railroad Kansas City Southern de Mexico (KCSM) is mixed, with rail cars down 7.6% but trailers and containers up 7.6%.
The American Association of Railroads states: "Railroads reporting to AAR account for 89 percent of U.S. carload freight and 98 percent of rail inter-modal volume. When the U.S. operations of Canadian railroads are included, the figures increase to 96 percent and 100 percent. The Canadian railroads reporting to the AAR account for 91 percent of Canadian rail traffic. Railroads provide more than 40 percent of U.S. intercity freight transportation, more than any other mode, and rail traffic figures are regarded as an important economic indicator."
One additional note: We wish to express our gratitude to and admiration for the American railroad industry for being recognized as having the safest year ever in their history. Railroads had 402 fewer train accidents in 2006 than 2005, down 12.4 percent. American railroads are to be respected and revered as a shining example of the way business in America should be done.
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Reader Comments (Page 1 of 1)
5-23-2007 @ 2:00PM
William Ehlert said...
402 fewer trafic accidents could be made
even fewer if trains were switched to
electricity producing concerens. By
adding wheels under the rail cars which
tuck up underneath when not in use. these
could be tasked to come down and make
power when tasked to do so by an onboard
computer. This could be wireless to lessen
the burden of weight but the added
traction these could give a train a much
shorter stoping distance. Just for safety
they should consider these.
With the rail cars being privately owned
each owner could stand to gain extra from
his car, the rail roads would stand to
gain also as I have a plan which would
increase our electric energy output
enough that electricity would be cheaper
for them than diesel. By building a
National system to collect this power, we
could use it to power trains also. The
Nation gains from doing it with increased
good paying jobs and less demand on
foreign oil. The Nations bus companies as
well as the hurting fishing and trucking
industries get to take advantage of
cheaper diesel with demand dropping way
off. The Nations car owners get cheaper
prices of gas at the pump with more people
using cheaper diesel lessening the demand
for gas.
A real win, win situation, we just
need someone to see it, that can do
something!
williamehlert@aol.com