Freight trains are carrying a shrinking amount of cargo as railroads feel the effects of trade tensions and changes to their own systems that are driving customers elsewhere.
The number of U.S. railroad carloads shipped fell 2.9% in the first half of the year, according to the Association of American Railroads. The slowdown was widespread, with 16 of 20 categories of shipments including food, lumber, auto parts and metals, posting declines, The Wall Street Journal reports.
Railroad shipping data provides insight into a cross-section of the domestic economy, given that the industry moves raw materials, finished goods and e-commerce packages.
Executives at CSX Corp., Union Pacific Corp. and other railroads started the year confident a strong economy would lead to more goods for them to move across their network. But since then, North America’s freight railroads have dealt with severe weather and flooding, escalating trade disputes and cooling pockets of the U.S. economy.
The railroads, which begin to report second-quarter earnings this week, may not have enough time in the second half of the year to hit their earlier projected volume goals. Read the full story.