Rail Traffic SURGES: Intermodal Hits Record Highs

North American rail traffic experienced a 3.5% increase in week 38, with intermodal volumes leading the surge at a 5.3% year-over-year gain and carloads increasing 1.5%. Chemical and petroleum shipments, which made up the second-largest carload commodity category, saw a notable 7.7% jump. However, a shortage of drayage drivers could potentially limit further growth.

The drayage workforce has steadily decreased since the height of the supply chain crisis, falling from 531,000 drivers in 2022 to 467,000 as of July, marking a 3% decline during rising volumes. This driver shortage may already be hindering the growth of intermodal carriers. BNSF's Quantum intermodal product, operated with JB Hunt, has grown every month, and the railroads' ability to maintain intermodal gains relies on keeping fuel prices high enough to make rail economically competitive.

Brightline, a Florida passenger carrier, filed for bankruptcy protection but continues to operate, with analysts expecting a debt restructuring rather than a shutdown.