The Association of American Railroads Wednesday reported week ending January 14, 2017 total US weekly rail traffic was 516,229 carloads and intermodal units, up 2 per cent from the same week last year.
US Railcar Loadings, Trucking Index: January 2017
Total carloads for the week ending January 14 were 253,223 carloads, up 4.4 per cent compared with the same week in 2016, while US weekly intermodal volume was 263,006 containers and trailers, down 0.3 per cent com- pared to 2016.
Commodity groups that posted decreases compared with the same week in 2016 included petroleum and petroleum products; forest products, down 5.8 per cent to 9,492 carloads; and chemicals.
Canadian railroads reported 75,862 carloads for the week, up 10.5 per cent, and 60,227 intermodal units, up 3.6 per cent compared with the same week in 2016. For the first two weeks of 2017, Canadian railroads reported cumulative rail traffic volume of 257,169 carloads, containers and trailers, up 1.3 per cent.
RAIL TRAFFIC PROJECTION
“We remain focused on providing the best possible rail network for our customers and all Americans, and as a result, the freight rail industry will advocate for a simpler and fairer tax code to enhance US economic development, promote growth and reduce debt. Freight railroads will also push for a sustainable funding source that provides for aggressive investment in public infrastructure.”
– Edward R. Hamberger, President and CEO of the Association of American Railroads
US ATA Trucking Index: January 2017
The most recent edition of the Trucking Conditions Index issued this week by freight transportation consultancy FTR remained in familiar territory, as market conditions appeared to show signs of stabilization at the end of 2016 heading into 2017, said Logistics Management Tuesday.
The TCI reflects tightening conditions for hauling capacity and is comprised of various metrics, including capacity, fuel, bankruptcies, cost of capital, and freight.
TRUCKING CONDITIONS INDEX
According to FTR, a TCI reading above zero represents an adequate trucking environment, with readings above ten indicating that volumes, prices, and margin are in a good range for carriers.
For November, the most recent month for which data is available, the TCI was 4.38, which is in line with October’s 4.58. FTR observed that the TCI is consistent with the firm’s forecasts of steadily improving trucking conditions early into the New Year.
And looking ahead, FTR expects the TCI to hit positive double digits by the end of 2017, citing things like expectations for stronger demand and the electronic logging device mandate expected to tighten capacity.
Truck utilization has improved by 3 percentage points, and the Market Demand Index from Truckstop.com jumped by 40 per cent to end 2016.
MARKET OUTLOOK
Even though the market outlook is showing signs of optimism, the freight environment remains in a pattern of largely flat growth, including a better than expected third quarter GDP estimated approaching 3.5 per cent, decent job growth figures, and signs of increased consumer spending.
But these alone have not been consistent enough to translate into sustained economic growth, coupled with excess trucking capacity still being hampered by elevated inventories, which have shown signs of heading down recently.
This sentiment was in line with commentary from American Trucking Associations Chief Economist Bob Costello who said in December that retail sales are good, the housing market is solid, and the inventory overhang throughout the supply chain is coming down, all of which will help support truck freight volumes in 2017.
Stifel analyst John Larkin said in the LM 2017 Rate Outlook that this year may lead to evidence of the tight supply/demand dynamic flexing its muscles as early as the second quarter volume peak, with truckload carriers approaching shippers asking for price increases.