U.S. freight-rail volumes rose nearly 5% in February

Driven by surging intermodal volume, U.S. railroads reported a 4.9% increase in traffic last month compared with February 2023, according to Association of American Railroads data.

The railroads originated 885,548 carloads last month, down 1.3% year over year. But they also hauled 1,040,312 containers and trailers, a 10.9% increase over February 2023's intermodal volume. Combined, the railroads moved 1,925,860 carloads, containers and trailers last month.

Thirteen of the 20 carload commodity categories that AAR tracks monthly posted gains compared to February 2023. They included motor vehicles and parts, up 12.3%; chemicals, up 5.1%; and grain, up 6.3%.

Commodities that posted decreases last month included coal, down 11.7% carloads; crushed stone, sand and gravel, -10.1%; and nonmetallic minerals, -12.7%.

"In February, U.S. rail traffic recovered from disruptions caused by severe winter weather in January. However, a closer look at February’s rail traffic data shows elements that inspire optimism and elements that call for caution," said AAR Chief Economist Rand Ghayad in a press release.

Intermodal volume gains over the past six months signal increased confidence among consumers and retailers, Ghayad believes.

"At the same time, carloads of industrial products remain below levels from last spring and summer, reflecting ongoing challenges in the industrial sector," Ghayad said.

Looking ahead, Ghayad hopes to see improvements in manufacturing output and consumer spending, both key drivers of rail transportation.

"This comes as the goods-producing sector begins to rebound from the stagnation experienced in the sector following the post-COVID-19 period," he said.

U.S. carload traffic for the first two months of 2024 totaled 1,910,716 units, down 4.6%, while intermodal volume totaled 2,246,326 containers and trailers, up 7.9%, compared with the same 2023 period.