The report of February rail freight movements was released Thursday March 6, by The Association of American Railroads. Again this month the report reveals some mentionable trends. The report on the AAR website indicates a gain in rail freight volume of 2.8 percent, for the first nine weeks of 2008. An estimated 296.1 billion ton-miles total volume was reported for the period.There are declines showing in inter-modal traffic. Trailer and container loading is down 3.4 percent for the first two months of 2008. This means that a higher volume of freight is moving by rail, yet less of it is getting to the rails via truck. I could speculate that railroads shall continue to become increasingly more cost effective for volume shipment of freight. Watch for new possibilities with direct-from-rail distribution centers. Watch for rapid growth and development in the RFID sector.
AAR reports that, "Commodities with the largest carload gains in 2008 through February were coal (up 44,127 carloads, or 3.6 percent); grain (up 36,207 carloads, or 18.8 percent); and chemicals (up 9,809 carloads, or 3.7 percent)." The majority of these freight increases seem to be destined for export. We could expect coal, grain and chemicals would top the list of commodities which had increased loading numbers as those are in high demand by developing industrial nations.. The AAR report further stated that: "Ten of the 19 major commodity categories tracked by the AAR saw U.S. carload increases in February 2008 compared to February 2007." The report additionally clarifies that changes in item tax status may be skewing the coal / coke volume changes.
A significant decrease in loading was seen for February in coke (industrial fuel) which dropped 6.4 percent. The infrastructure staples of crushed stone, sand and gravel loaded 6.9 percent less in February. Perhaps the most telling loss however is in the category of lumber and wood products which logged a reduction of rail loading by a whopping 19.3 percent. That's a dead giveaway that lumber yards and home centers are playing very tight fisted going into the building season, or that there's significant product backlog at the retail level.
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