Intermodal volumes and oceanic freight rates are also increasing
May 30, 2024
Key Observations:
Volumes on North American rails contracted between Nov-21 and Dec-23 on a smoothed basis. Since that soft patch, traffic has been picking up and now stands at 3% for the 16-week mavg in the YoY change. This figure includes a large slump in coal shipments (–16.4% YoY, same smoothing).
Current activity for total carloads is consistent with growth rates in 2012-15 and 2017-19, or, in other words, during normal economic regimes. Over the past two months, the four-week mavg for total carloads has decelerated from 4.3% to 2.0% YoY; however, the comparable figures for commodity volumes have improved from –3.4% to –1.4% YoY over the past month, again inclusive of coal.
Meanwhile, container rates are surging again worldwide on the rising global economic activity amidst precautionary reroutings in global marine traffic provoked by the conflict in the Red Sea.
The world benchmark rate is now $4,072 per FEU (May 23), +195% from $1,382 at 30-Nov-2023.
Container imports through the Port of Los Angeles tallied to 417,182 TEUs in Apr-24. Though this activity trails the frantic post-pandemic pace to restore supply chains in 2021 and 2022, it is better than last year. Cumulative ytd imports at Apr. 30 are +345 TEUs (+26.4%) YoY. Including exports, this port’s total container traffic, cumulative ytd at Apr. 30, is +626 TEUs (+24.8%) YoY.
Source: AAR, Port of Los Angeles, Drewry, Blacklight Research. Note: TEU = twenty-foot equivalent unit. FEU = forty-foot equivalent unit. As of May 23, the benchmark container rate for the Shanghai to Rotterdam route is $4,999 per FEU, +398% from $1,004 (26-Oct-2023). The benchmark container rate for the Shanghai to New York route is $6,463 per FEU, +152% from $2,563 (30-Nov-2023). Rotterdam to New York is at $2,241 per FEU, +51% from $1,486 (30-Nov-2023).
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