Posts Tagged ‘railroad carload traffic’

Intermodal Growth Seen Continuing into 2021

December 13, 2020

A railroad industry consulting firm has predicted that intermodal traffic will continue growing in 2021 but carload traffic will continue to struggle to recover from the COVID-19 pandemic.

FRT Transportation Intelligence predicted that intermodal traffic will increase by 5.4 percent in 2021 with most of that growth attributed to retailers restocking their inventories due to consumer demand.

Domestic container volume will rise by 6.2 percent while trailer volume is expected to hold steady.

The latter has been in decline in recent years but has received a boost in recent weeks by tight capacity in the trucking industry and a shortage of truck drivers.

FRT projects international intermodal volume to increase by 5.4 percent in 2021.

Todd Tranausky, vice president of rail and intermodal at FTR, said last week that those who still have jobs have shifted their discretionary spending from services to consumer goods as a result of pandemic-related factors such as social distancing.

Intermodal volume in past years has declined after its fall peak, but that had not been the case this year, Tranausky said.

Tranausky said a variable that could affect intermodal volume is the distribution of COVID-19 vaccines.

If vaccines help led to a diminishing of the pandemic in the second half of next year that could prompt consumers to begin spending again on such services as restaurants, theaters and cultural events.

In the meantime, FTR expects intermodal volume for 2020 to be 2.5 percent below 2019 levels despite increases in recent months in intermodal traffic.

As for carload traffic, it is tied to industrial production, which has lagged during the pandemic as it struggles to reach pre-pandemic levels.

Except for coal, agriculture and anything tied to crude oil, FRT expects carload traffic in 2021 to be flat.

The consulting firm sees some recovery in the first quarter and that second quarter year-over-year numbers will show large gains due to being compared to the pandemic-related traffic levels of 2020. 

Tranausky said carload volumes in the third and fourth quarters of 2021 will hinge on how the pandemic and consumer spending unfold, as well as whether there’s a federal stimulus and what shape it takes.