Rail Traffic Following Expected Pattern

Total N. American rail traffic clocked in at 667k cars last weeks vs 676k the prior week. Virtually all of the decline can be attributed to fewer coal shipments. We are entering the time a year shipments typically waffle around until mid summer when retailers start stocking up for “back to school” season and the summer vacation season ends.

We said a few weeks ago that we expected #’s to gyrate up and down in this range and that is what we are seeing. We DO NOT want to see a steady decline but will not get alarmed at weekly up or downs.

Japan. We have not seen the effect from Japan we thought we would. We thought numbers would be lower than they are given the devastation there. That leads us to the conclusion that while there has been an effect (there simply has to have been), domestic strength has offset it. Yes, I am aware recent numbers were less than ideal but in no way did any one of them signal anything but continued expansion. We may not be expanding at the rate people want, but we are still expanding. Rail traffic data backs this up.

Of the carriers, $CSV saw a 2% increase while $BNI saw a 5% decrease