Panelists See Slow Freight Rebound

Railroad industry analysts predicted this week that the COVID-19 pandemic will cause fundamental changes in the U.S. economy that will result in limited railroad freight traffic growth over the year.

The prediction was made during a webcast sponsored by the Midwest Association of Rail Shippers with panelists saying the pandemic has caused a great deal of economic uncertainty and the recovery that began in June remains fragile.

“We are not even close to getting back to equilibrium,” said Eric Starks, CEO of FTR Transportation Intelligence.

Straks expects the economic downturn will linger until there is an effective COVID-19 vaccine available.

Another member of the FTR firm, Todd Tranausky, said that in recent weeks intermodal traffic has gotten a boost from the need of retailers to restock their inventories.

Intermodal traffic also has benefited from tightening truck capacity, prompting shippers to turn to rail to move goods.

This has included parcel shippers seeking a relief valve for moving their packages.

For now, importers are routing more good via West Coast ports in order to get them to consumers faster.

However, he said that carload volume will be much slower to rise because industrial inventories are already at high levels.

FTR expects carload traffic to lag through at least the first quarter of 2021.

“It’s going to be a very slow, very uneven slog back to growth in the carload sectors,” Tranasuky said.

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