RAIL SHIPPING TRENDS FOR 2014
There is no doubt that the world economy is on the rebound. Home prices are up, unemployment numbers are down and freight volumes are on the rise as well. This is great for our industry and for everyone in general because the transportation and logistics industry employs many different people in many facets of this complex industry. In order to make it seem seamless there are lots of working parts that from the outside looking in are not visible. There are many sub categories of the freight shipping industry ranging from rail shipping, LTL, truckload and ocean containers.
Although spending has been cut drastically on our nation’s infrastructure the rail industry has put their money where their mouths are. The rail has kept their eye on many aspects affecting the shipping industry including the increase in freight volumes; the deficit in truck drivers to meet the necessity of shippers and customers is no secret, well at least not to those of us on the inside. Freight volumes are expected to grow 1.5% a year for the next 30 years, which is an increase of over 60%. The rail has responded with record investments in their truckload rail cars and equipment. In the year 2012 the rail industry spent $25.5 billion dollars to improve their system, to put that in perspective that is nearly $270,000 per mile of railroad track in the United States. The rail is indeed looking to the future and readying itself for the capacity demands that are sure to come. Shipping via rail will indeed become more commonplace and dare I say necessary in order for our manufacturing sector to compete in this new world economy.
There are some factors that we are need to accept and that is that there are certain aspects that affect shipping prices that will not change.
The first and foremost is that fuel prices will not be coming down anytime soon, as a matter of fact as the economy improves you can bet that this precious commodity which’s fuels almost all methods of transportation will rise as well. Also the introduction of new acts in congress to help fund our nation’s failing infrastructure is going to come in the form of a new gas tax. This new tax is slated to begin in 2014 spread out over a 3 year period to help the gas tax reach where it should have been had it kept up with inflation. As we come to a close in the year 2013 I predict that 2014 will be a stellar year for the shipping industry and like everything else will have its ups and downs but rail shipping will certainly be something for those of us in the transportation industry to keep our eye on.
