December and full-year 2015 intermodal volumes are strong, reports IANA

By Jeff Berman, Group News Editor
January 21, 2016

Despite the many peaks and valleys freight flows saw in 2015, one mode that collectively saw more of the former was intermodal.

That was especially clear in December and full-year 2015 volumes from the Intermodal Association of North America (IANA).

Intermodal metrics for the month of December were mixed, with trailers down 18.5 percent annually at 118,666, and international (ISO) containers off 1.4 percent at 653,631. Domestic containers saw a 5.9 percent boost at 565,616, and all domestic equipment saw a marginal annual increase, up 0.6 percent at 653,631.

For all of 2015, trailers remained down, off 6.0 percent compared to 2014 at 1,566,702. Domestic containers were up 5.1 percent at 6,773,661, and all domestic equipment was up 2.8 percent at 8,340,363. International containers rose 2.8 percent at 8,396,631.

In looking at these numbers, I recalled a column in this space that took a look back at 2015, which examined the gains seen in international intermodal, which was the volume winner by a nose in 2015 over all domestic equipment (which was paced by domestic containers in conjunction with the steady gains domestic intermodal volumes have made in recent years).

The December column noted that: “In recent years, domestic intermodal has been the growth engine of intermodal volumes, but that might be changing as 2015 saw better than good international, or ISO, volumes gain steam. Much of that was due in part to the carryover effect of the West Coast port labor situation that left shipments delayed or held up for long periods before reaching their final destination. The West Coast port labor issues during the first quarter created a freight backlog that subsequently led to higher than usual second quarter volumes and in the second and third quarters international containers again paced quarterly growth, up 4.0 percent, according to the Intermodal Association of North America. IANA explained that international growth has been “very volatile” in 2015, with the port disruptions being a factor for that earlier this year, as well as variations in the third quarter, too, with July up 3.3 percent, August up 6.6 percent, and September up 1.6 percent. The report added that this was likely due to shippers moving freight earlier in the year than usual as evidenced by the strength of August’s volumes and September’s sequential decrease.”

It goes without saying that the West Coast port labor situation impacted international volumes and with those comps likely disappearing by April, coupled with various global economic worries, it still is too early into 2016 to get a full sense of what may be coming our way.

Either way, it is clear that during these largely uncertain (again) times that intermodal remains in a position of strength.

If you need more data to buy into that aside from IANA’s, take a look at the 2015 data from the Association of American Railroads.

Total 2015 U.S. container and trailer volume was up 1.6 percent at 13,710,646 units compared to 2014’s 13,496,941, according to the AAR. The 2015 tally topped 2014 as the new annual high for U.S. intermodal volume. The previous high prior to the last two years was 2013’s 12,831,692.

Based on that, it is apparent that U.S. intermodal volumes in recent years are really in good company, right?

What’s more, as previously reported, the ongoing intermodal growth continues to highlight recurring themes cited by the AAR, IANA, and industry stakeholders that note intermodal’s cost-effectiveness in moving rail intermodal shipments, especially in comparison to trailers, as containers can be double-stacked and are easier to load onto and take off a railroad flat car than trailers.

Larry Gross, senior consultant at freight transportation consultancy FTR, said that prospects for international intermodal into the U.S. figure to be promising with unemployment relatively low, growth in the consumer economy, and consumers having more disposable due to lower gas prices.

“The fundamentals are in place, at least on the consumer side, to support import growth,” he said. “But the domestic intermodal piece has more going on with growth slowing mostly because of the combined effect of truck capacity lower fuel prices and the hangover from service issues that now have been largely resolved.”

It is easy to see that the pieces are in place for continued growth, but as Gross points out, there are also related challenges, too. The 2015 intermodal story looks to be an interesting one, regardless of which direction it goes in.