September was the fourth-best month for U.S. intermodal traffic in the history of the U.S. railroads, the Association of American Railroads (AAR) said Wednesday.
The U.S. freight railroads originated 1.4 million intermodal containers and trailers in September, a 7.1% increase from September 2019.
On a year-to-date basis, U.S. intermodal traffic is 5.9% lower than the same period in 2019, AAR said. Year-to-date intermodal volumes totaled 10 million containers and trailers for the week that ended Saturday.
The rise in intermodal traffic comes amid an all-time high in U.S. imports this summer, according to the National Retail Federation (NRF). The trade group’s monthly report on major U.S. ports calculated that the ports handled 2.1 million twenty-foot equivalent units (TEUs) in August, a 9.7% increase from July and 8% increase year-over-year. That total is also the highest number of containers imported in a single month since NRF began tracking imports in 2002, the group said.
“After staying at home this spring, consumers are buying again and retail supply chains are working overtime to keep up with demand,” said Jonathan Gold, NRF vice president for supply chain and customs policy. NRF estimates September import volumes at major U.S. ports to be 2.08 million TEUs, which would be a 10.9% increase from a year ago.
“Nothing about this year is predictable, but retailers are making sure their shelves and warehouses are well stocked for the holidays,” Gold said. “They are also stocking up earlier than usual because they know many consumers will be shopping early this year to avoid crowds and shipping delays. Some holiday merchandise that normally wouldn’t arrive until Halloween is already here.”
Others have confirmed NRF’s observations. Last week, FreightWaves reported that investment bank Jefferies recently hinted that import flows could remain heavy all the way into 2021 as companies are just getting started with restocking.
“We are just at the beginning of what is likely to be one of the biggest restocking cycles — if not the biggest inventory restocking cycle — in U.S. history,” FreightWaves reported Jefferies Chief Economist Aneta Markowska as saying.
While U.S. intermodal traffic grew in September, carloads were still lower than a year ago, although volumes rose for some commodities.
U.S. carload volumes totaled 1.1 million in September, a 9.7% decrease from September 2019. Of that total, grain carloads rose 27.8%, iron and steel scrap rose 12.2%, and grain mill products grew 4.7%. But coal carloads fell 24.2%, crushed stone, sand and gravel slipped 20.9%, and chemicals dropped 5.6%.
“Rail carloads, which don’t include intermodal, remained down in September compared with last year but showed marked improvement compared to a few months ago, especially if you exclude coal. In the meantime, railroads remain focused on keeping their employees safe while delivering the goods our nation needs,” said AAR Senior Vice President John T. Gray.
Overall September volume was 2.5 million carloads and intermodal units, a 1% decline from last year as intermodal volumes offset traffic losses for carloads.
Click here for more FreightWaves articles by Joanna Marsh.
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