U.S. carload volume on a weekly basis is almost at the same level as a year ago, with last week’s volumes down by only 1.4%, according to data from the Association of American Railroads.
U.S. carload traffic totaled 244,986 carloads for the week ending Saturday, which is 1.4% lower than the same period in 2019 and 18.8% higher sequentially. Sequential totals reflect volumes over the Thanksgiving holiday.
Meanwhile, weekly U.S. intermodal volumes rose 10.5% to 297,217 intermodal units.
Combined traffic was 542,203 carloads and intermodal units, which is 4.8% higher than a year ago. Year-to-date combined traffic is 23.3 million carloads and intermodal units, down 8.1% over the same period in 2019.
Intermodal volumes have gotten a push from higher U.S. imports, which “remain strong” this fall as retailers rush to fill warehouses for the holiday season and meet fast turnarounds for online orders, according to the National Retail Federation (NRF).
The trade group calculated that major U.S. ports handled 2.21 million twenty-foot equivalent units (TEUs) in October, according to its monthly port report. October’s totals were 17.6% higher than October 2019 and 5.2% than September, which itself was an all-time record since BRF began tracking imports in 2002.
November’s totals are estimated at 2.07 million TEUs, which is 22.4% higher than a year ago, and December could total 1.91 million TEUs, which would be 11% more than December 2019.
Meanwhile, NRF estimates that holiday sales in November and December could grow between 3.6% and 5.2% over 2019 to between $755.3 billion and $766.7 billion.
“The pandemic has made the past year one of the most trying the supply chain has ever seen, but retailers have met that challenge,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said. “We’ve gone from not knowing whether we would be able to get merchandise from China to having a surplus of goods when stores were closed to having to meet pent-up demand as consumers returned. At this point, retailers have seen a successful holiday season so far and goods are reaching the shelves. We hope 2020 is a one-time experience, but we’ve learned a lot.”
However, despite the import surge and the double-digit percentage growth for rail intermodal volumes, network capacity is strained at the ports amid limited warehouse storage and labor shortages, among other factors, according to a Wednesday FreightWaves Passport Research report.
Indeed, Norfolk Southern (NYSE: NSC) said last week at an investor conference that supply chain disruptions are putting limits on intermodal growth.
“Last week, intermodal volumes across the Class Is maintained double-digit year-over-year growth, and average intermodal train velocities also accelerated. Intermodal tender rejections on a national basis actually came down under 3%, but we expect further waves of tightening and congestion to ripple through the nation’s intermodal network into Q1,” said Tony Mulvey, a FreightWaves Passport research associate.
He continued, “Large IMCs are working with railroads on long-term solutions to capacity issues and container imbalances, but there is no obvious path forward. Bottlenecks in Los Angeles and Long Beach are being exacerbated by multiple factors, including high volumes, lack of space, imbalanced container flows and labor shortages. Those overlapping problems are creating extraordinary delays and additional costs in intermodal networks.”
Subscribe to FreightWaves’ e-newsletters and get the latest insights on freight right your inbox.
Click here for more FreightWaves articles by Joanna Marsh.
Related articles:
COVID-19 uncertainties, PSR part II: What’s on the minds of rail execs
Being the port of now helps solve retailers’ future problems
Industrial production and retail sales – FreightWaves NOW
White Paper – How E-Commerce Has Changed Supply Chains & The Retail Experience