North American Rail Traffic Generally Up in June

The Association of American Railroads reported U.S. rail carloads originated in June 2012 totaled 1,140,271, down 1.3 percent compared with June 2011. Intermodal volume in June 2012 totaled 996,022 containers and trailers, up 49,168 units or 5.2 percent compared with June 2011. The June 2012 average weekly intermodal volume of 249,006 units is the highest average for any June on record and the third-highest for any month, behind August and October 2006.

Nine of the 20 commodity groups saw carload gains in June 2012 compared with June 2011, including: petroleum and petroleum products, up 14,177 carloads, or 51 percent; motor vehicles and parts, up 12,957 carloads, or 24.5 percent; food products, up 1,549 carloads, or 6.2 percent; and lumber and wood products, up 1,336 carloads, or 11.4 percent.

Commodities with carload declines in June 2012 were led by coal, down 30,152 carloads, or 6.2 percent; grain, down 9,159 carloads, or 10.6 percent; metallic ores, down 2,804 carloads, or 8 percent; and iron and steel scrap, down 1,951 carloads, or 10.2 percent. Carloads excluding coal were up 14,979 carloads or 2.2 percent in June 2012 over June 2011.  Carloads excluding coal and grain were up 24,138 carloads or 4.2 percent in June 2012 over June 2011.

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U.S. Supply Chain and Logistics Industry Rebound Led by Trucking, Rail

Total U.S. business logistics costs in 2011 rose to $1.28 trillion, a 6.6% increase from the previous year and accounting for 8.5% of the U.S. gross domestic product, according to the Council of Supply Chain Management Professionals' 23rd Annual "State of Logistics Report," presented by Penske Logistics.

This year's report reveals that with overall revenue 15.3% higher than 2010, railroads gained market share, especially in intermodal, and did not experience capacity problems faced by the trucking sector. Trucking companies are also using intermodal rail help to offset the impacts of driver shortages and the costs of acquiring and maintaining new equipment. In spite of tightening capacity and an overall decline in volume, trucking rates were up 5% to 15% in 2011.

Inventory carrying costs in 2011 continued their rising trend and overall inventories have returned to pre-recession levels, which could be a cause for concern for the economy. The growth has occurred among wholesalers and manufacturers while retail inventories remained flat, indicating that inventory management processes have changed.