The Association of American Railroads (AAR) released U.S. rail traffic for the week ended March 21, 2020, and it contained some much-needed good news: The worst of the coronavirus’ effects on Asian trade may be over.
“The good news is that the intermodal volumes of the railroads serving the West Coast ports that receive the bulk of imports from China appear to have plateaued over the past four weeks, indicating that we may have seen the worst of the COVID-19 impacts on the Asia trade,” said AAR Senior Vice President Policy and Economics John T. Gray.
“It wouldn’t be surprising to see rail volumes of other categories soften in the weeks ahead as steps taken to limit the spread of COVID-19 continue to impact producers, both here and abroad, particularly those of consumer goods or intermediate products from which those goods are produced,” Gray said.
Indeed. For the week ended March 21, total U.S. weekly rail traffic was 459,966 carloads and intermodal units, down 8.6% compared with the same week last year. Total carloads for this week were 224,048 carloads, down 5.4% compared with the same week in 2019, while U.S. weekly intermodal volume was 235,918 containers and trailers, down 11.4% compared to 2019.
Three of the 10 carload commodity groups posted an increase compared with the same week in 2019. They were chemicals, up 3,760 carloads, to 34,471; miscellaneous carloads, up 858 carloads, to 9,747; and farm products excl. grain, and food, up 507 carloads, to 15,984. Commodity groups that posted decreases compared with the same week in 2019 included commodities such as coal, down 9,223 carloads, to 56,093; nonmetallic minerals, down 4,774 carloads, to 30,674; and metallic ores and metals, down 1,427 carloads, to 18,576.
“Demand for rail service depends on the demand further down the chain for the products railroads haul and on the ability of firms they serve to produce what is demanded,” said Gray. “Autos are a good example. What with job uncertainty and either voluntary or enforced social distancing for many people, this isn’t a great time to visit new car showrooms, so demand for autos is down. Further, most automakers have suspended manufacturing operations for the time being. As a result of both these factors, rail carloads of autos and auto parts fell considerably this past week.”
For the first 12 weeks of 2020, U.S. railroads reported cumulative volume of 2,773,207 carloads, down 6.1% from the same point last year; and 2,948,362 intermodal units, down 8.1% from last year. Total combined U.S. traffic for the first 12 weeks of 2020 was 5,721,569 carloads and intermodal units, a decrease of 7.2% compared to last year.