WASHINGTON — U.S. rail traffic began 2023 in sluggish fashion, with overall volume for January down 3.2% from the first month of 2022, according to the Association of American Railroads.
Weekly traffic for the week ending Jan. 28 was also down compared to the corresponding week a year earlier.
The January figures included a 2.2% increase in carload traffic — led by a 22.6% rise in crushed stone, sand, and gravel, and a 13.4% increase in motor vehicles and parts — but an 8.1% decline in intermodal traffic. It is the fifth straight month in which rail traffic has been down compared to the previous-year figure.
“Rail traffic began 2023 much the same way we ended 2022 — demonstrating reasons for both optimism and caution,” AAR Senior Vice President John T. Gray said . “For example, this was the best January for carloads of crushed stone and sand on record, largely due to the growth in domestic natural gas production and the need for frac sand. Automotive traffic, although not yet at pre-pandemic levels, had a healthy improvement over 2022. Negatively, it was the worst January for intermodal since 2013, with major retailers cutting back on inventories and consumer spending — especially on goods — having contracted.”
Weekly traffic shows 3.9% drop
Traffic for the fourth week of 2023 saw a total of 473,650 carloads and intermodal units, down 3.9% from the same week in 2022. This followed declines of 5.5%, 1.7%, and 2.1% in the first three weeks.
The weekly figure included 236,018 carloads, down 0.1%, and 237,632 containers and trailers, down 7.4%.
North American totals, for 12 reporting U.S., Canadian, and Mexican railroads, include 340,616 carloads, up 2.3%, and 317,248 intermodal units, down 6.2%. North American totals through four week show total volume down 0.9% compared to 2022.
Add in the fact that retailers stocked their warehouses to the brim and still have inventory to burn through. I don’t think their is a single US container report that has congestion at this time. But as Ron noted, it appears the railroads rather wait on the more lucrative port traffic then be more competitive for the domestic market. Which is still a head skratcher as BNSF going through with its big South Cali intermodal investment and NS got approval on its big Chicago expansion.
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Also of note, Wallstreet Journal had a good article on how Mexico is gaining some of the industrial onshoring back from Asia. How much of those goods will travel north on trucks?
The Class Ones refuse to drop prices on container shipments, as trucking becomes cheaper. Unless something changes there, we can expect to see this trend continue one would think. Once again, self inflicted wounds by the rail industry upon itself.