Canadian railroads' streak of intermodal records likely to end in 2020, AAR report says

Canadian railroads' three-year streak of annual intermodal records is likely to end in 2020, according to the Association of American Railroads' (AAR) latest Rail Time Indicators (RTI) report.

During the first seven months of 2020, Canadian railroads' intermodal traffic declined 6.7 percent, or 142,188 units, compared with the same period in 2019. In July, Canadian railroads logged a 6.2 percent decline in intermodal volume. During the entire month, Canadian railroads originated an average of 66,693 intermodal units per week, the second most for any month so far in 2020 — and just behind April, the report states.

Meanwhile, total Canadian carloads decreased 13.2 percent in July compared with July 2019. AAR attributed the decline to decreases in petroleum and petroleum products, down 43 percent; crushed stone, sand and gravel, down 52.5 percent; and coal, down 31.3 percent.

"The collapse of the oil market hit Canadian oil producers hard," the report states, noting that Canada's National Energy Board reported that 84 rigs were drilling for oil on June 28, 2019, compared with four on June 26, 2020.

Commodities that posted carload gains for Canadian railroads last month were led by farm products, which were up 55.7 percent. That category includes pulses, which include lentils, chickpeas, dry peas and beans. Canada is the world's top supplier of pulses. 

Canadian carloads of grain rose 14.2 percent in July, the biggest year-over-year gain in 15 months, according to the RTI report.

AAR's Policy and Economics Department produces the RTI report.