Rail/Intermodal
Total rail traffic was down 0.1% y/y for the week ended July 20, according to the Association of American Railroads. Carloads have struggled in recent weeks due to the mid-week July 4th holiday, which was compounded by the effects of Hurricane Beryl in the central portion of the southern U.S.
While many carload commodities have recovered from these events, many others continue to drag. Total carloads for the week were down 4.1%. The markets with the greatest y/y increases include farm products (16.4%), grain mill products (13.7%), and petroleum products (13.3%). Those with the greatest y/y decreases include coke (27.4%), autos (18.1%), and crush stone, sand and gravel (15.1%).
Intermodal traffic has returned to normal levels after two weeks of extreme y/y increases. Those increases are primarily attributable to the port strikes in British Columbia last year, which manifested in the form of a weak 2023 and a strong 2024 by comparison. Overall intermodal traffic grew 3.9% across North America. This equates to container growth of 5.3% y/y – the lowest growth rate since January, and another bleak week for trailers, down 25.7% y/y.
YTD, total rail traffic is up 2.3% with carloads down 3.3% and intermodal up 8.1%. Of the 10 commodity carload groups reported by AAR, five show positive YTD y/y growth, up from four last week. These commodities include petroleum products (8.8%), chemicals (4.4%), grain (2.8%), motor vehicles & parts (0.2%), and, most recently, farm products (excl. grain) (0.2%).
Rail Safety Legislation
In other news, Rep. Troy Nehls (R-Texas), who chairs the House subcommittee overseeing rail safety, has introduced the Railroad Safety Enhancement Act of 2024 (H.R. 8996), which incorporates a Senate rail safety bill (S. 576) that was introduced in March of last year.
Among other provisions, H.R. 8996 would require all Class I's to enroll in a “Confidential Close Call Reporting System, which would allow railroad employees to report safety incidents and close calls. The bill would also allocate funds for the removal of highway crossings and for recuring grants, allowing for the installation and innovation of railcar telematics.
As with the Senate bill, H.R. 8996 has bipartisan support. Rep. Seth Moulton of Massachusetts, a high-ranking Democrat on the rail subcommittee, is a named original co-sponsor. As of today, the House bill has 18 co-sponsors who are nearly evenly split between Democrats and Republicans.
