Volume categories such as grain and intermodal helped U.S. rail traffic near pre-pandemic levels in April, according to the Association of American Railroads (AAR).

For the month, rail volumes totaled 2.13 million carloads and intermodal units, a 29.1% increase from April 2020. Much of the sizable year-over-year increase is due to volumes falling out in April and May at the onset of the COVID-19 pandemic in North America.

But some commodities, such as chemicals, are posting pre-pandemic volume gains, AAR said Wednesday.

“A number of U.S. rail traffic categories have completely recovered ground lost during the pandemic or are very close to doing so,” AAR Senior Vice President John T. Gray said. “For example, April set a new all-time record for intermodal, driven by surging international trade and strong consumer spending. Meanwhile, carloads of grain, food, lumber, paper, scrap metal and several other categories were higher in April 2021 than they were in both April 2020 and in April 2019. Carloads of chemicals and steel in April 2021 were much higher than last year and just shy of April 2019 levels.”

U.S. intermodal container originations in April were well above April levels in the past three years. (Source: SONAR)
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U.S. carload volume in April was 951,840, which was 23.7% higher than April 2020. Seventeen of the 20 carload commodity categories experienced year-over-year gains. Among the notable increases were coal, up 28.7%; motor vehicles and parts, up 465.9%; and chemicals, up 14.8%. Among the commodities that did not see increases were crushed stone, sand and gravel, down 1%; primary forest products, down 2.9%; and farm products excluding grain, down 1.9%.

Meanwhile, U.S. intermodal traffic was nearly 1.17 million containers and trailers, up 33.8% year-over-year.

Expect North American intermodal volumes to grow in 2021: IANA

Companies such as Hub Group (NASDAQ: HUBG) and Union Pacific (NYSE: UNP) expect favorable market conditions for intermodal traffic in 2021.

The Intermodal Association of North America (IANA) reflected similar sentiments when it released first-quarter 2021 data on April 29.

IANA expects robust intermodal growth for the remainder of 2021 amid an improving economy and weak year-over-year comparisons. The group anticipates North American intermodal volumes to grow by 6.3% in 2021 after falling 2% in 2020. Much of that growth will come from international intermodal movements, particularly as U.S. import levels remain high, but growth is also expected to occur from domestic container loads, according to IANA’s quarterly volumes report.

First-quarter 2021 intermodal volumes gained 10.5% year-over-year, with intermodal containers rising 14.8%, domestic shipments increasing 4.4% and trailers growing 20%.

Against easy comps, both international intermodal volume (left) and domestic intermodal volume (right) are up strong double-digit percentages versus 2020. (Source: SONAR)

“Intermodal volumes were up for the third consecutive quarter through Q1. This growth is projected to continue through the remainder of the year,” said Joni Casey, president and CEO of IANA. “Even considering weak comparisons that supported the other segments, domestic intermodal posted solid 4.4 percent gains.”

The seven highest-density trade corridors, which handle more than 60% of total volume, all rose in the first quarter, IANA said. Three corridors grew by double digits: Trans-Canada, 26.4%; Midwest-Southwest, 15.7%; and South Central-Southwest, 15.6%. Meanwhile, Southeast-Southwest rose 8.9%; Midwest-Northwest grew 8.3%; Intra-Southeast increased 7.5%; and Northeast-Midwest was up 5%.

Loaded intermodal volume is up significantly y/y in most international intermodal (left) and domestic intermodal (right) lanes. Volume on certain westbound backhaul lanes is the exception. (Source: SONAR)

Total volume for intermodal marketing companies rose by 10.2% in the first quarter, with intermodal and highway loads growing by 1.5% and 16.1%, respectively.

By international intermodal traffic, the Southwest region grew 29.9% amid strong West Coast imports, which led to an increase in transloading, IANA said in its report. Meanwhile, the Northeast region rose 11.4% and the Southeast region grew 13.1% on higher import levels.

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