Rail Traffic Nears 4 Year High
- Posted by ToddSullivan
- on August 30th, 2012
We are just a few thousand cars off a 4 year high in rail traffic. Total N. American rail traffic came in at 704K last week, up from 702K the week before and well ahead of the 693K we saw last year. We also will note a (10k) differential in coal shipments in ’12 vs ’11 which has been consistent with what we have seen. This is due to the collapse in natural gas prices and a surge in utilities switching from coal to gas. Since the gas is shipped by pipeline, that causes a decrease for that sector of rail traffic. We note and adjust for the difference because electricity production is flat YOY, it is just the fuel used for its production has changed. See below:
Because of that, in order to get a true YOY traffic comp, we normalize the coal number. The 4 year high for rail traffic was set last year in week 39 at 721K cars (week 39/40 it the typical annual peak). So if we adjust for the coal difference we are ~7K cars away from a record.
It doesn’t seem like the kind of thing we should be talking about if the economy is at “stall speed” or “in recession”. In fact, were that the case the words “near a record” would not be written and we would be lamenting YOY stagnation or even declines in traffic.
Here is the chart:
To see more posts on any of the companies mentioned in this article, enter their stock ticker symbol in the search box.
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.
Todd's investing strategy is essentially long with the rare short. He seeks to buy undervalued issues with an upcoming catalyst that will help them realized.... More »
aapl acas ackman aig AN bac BAM BBI bgp BPO buffett CC CODi CRE davidson dow einhorn employment ETFC f fairx FNMA fnmas ggp hhc housing IGOI jcp jmba joe mbi mcd mgm MO oesx PM rail sbux seth klarman SHLD spg spy theory VIC xom