Rail Traffic Continues to Move in Right Direction

Total N.American rail traffic last week checked in at 660k cars, 5.5% above the same week last year. Further, traffic hit the highest level in the last four weeks and the second highest level for 2011.

Last week we spoke about the possibilities for disruption to results due to Japan. It will take some time to see how this shakes out. Remember boats that left Japan just before the quake won’t reach our shores for another week (or are only just starting to). Any disruption will be felt in the boats that have not left since the quake and that will be felt in the upcoming weeks. Now, we can expect a surge of exports as Japan rebuilds, but since we are still a large net importer from Japan, we should see a dip in results. However, I still maintain that as the rebuilding gets underway in full force, rail traffic will surge as imports resume to prior levels and exports to help rebuild remain elevated.

This will unfold over the next couple months (assuming no further quakes/damage etc). The point here is not to panic if we see results dip during the next month or so. It will be a temporary issue that will be more than rectified later.

Here is the data: