Dive Brief:
- U.S. rail carloads increased 2% YoY in June to 1,080,769, while combined carloads and intermodal originations jumped 4.2% to 2,240,742 over the same time period, according to the Association of American Railroads (AAR).
- Containers and trailers were up 6.3% year over year at 1,159,973 in June, and total carload traffic for the first six months was up 1.3% at 6,747,414 carloads.
- June was also the third straight month that 14 of the 20 commodities transported by rail saw carload gains, which AAR Senior Vice President of Policy and Economics John T. Gray called "the longest such streak since late 2014."
Dive Insight:
Fresh off another round of tit-for-tat tariffs, rail traffic is still setting records and plowing ahead to meet the accelerating demands of a growing economy.
Rail is also keeping pace with ocean shipping and trucking. Both have been setting records this year in terms of volume, despite a brief hiccup in trucking when the electronic logging device (ELD) mandate went into effect in April.
Rates are rising for ocean shipping and trucking, which means an increase is likely for rail as well, especially as the Federal Reserve continues to raise interest rates throughout this year.
Gray said June's numbers are "consistent with a healthy economy," but with a caveat — bumpy trade situations with some of the United States' top trading partners could easily reverse the trend of growth, which former director of the National Economic Council Gary Cohn also said in a Q&A with the Washington Post a few weeks ago.
"The record intermodal volume for June speaks to the high value proposition that rail customers associate with intermodal service," Gray said. "For now, things are looking good for the railroads and the economy."
