While the jury is still out about whether we’re in a full-blown economic recovery, you can be assured the freight transportation industry is seeing a rebound.  We are experiencing a boost of Asian consumer goods to U.S. markets and domestic freight transportation has also surged in 2010, with the trucking companies and freight railroads both seeing increases.  This news points to an economic recovery.

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One of the more depressing symbols of the 2008-09 recession was readily visible anywhere in the Peoria IL Metro Region where there were railroad tracks: long lines of modern freight carrying railcars parked along every available stretch of side track, unneeded and in storage mode awaiting better times.  Experts will stop short of saying we’re in a full-blown economic recovery, however there’s little doubt that the freight transportation industry is indeed enjoying a rebound in 2010.  Those long lashups of surplus railcars are fast being redeployed to carry goods once again.

Looking at the cargo numbers, 2010 cannot help but look good because ’09 was so downright awful.  But even allowing for the mother of all economic troughs, the tidings so far this year have been bullish, with some variances depending on types of freight.  Asia has clearly rebooted its supply chain of consumer goods to U.S. markets: ocean carrier American President Lines saw its volume of containerized cargo rise 34 per cent from May ’09 to the same month this year.  Further, domestic transportation of high-end merchandise has also surged in 2010, with the trucking companies and freight railroads sharing in the largesse.  Such strong freight loadings benefit the locally based motor carriers that specialize in hauling products between Central Illinois and the intermodal railway hubs in the Chicago area.  “We’re really dumbfounded,” confessed one local trucking executive.  “In one year we’ve shifted from shedding assets for survival to the point where our biggest problem is finding enough qualified drivers to handle demand.  It is, however, the kind of problem you like to have.”

All is not totally rosy nonetheless.  Looking at the more basic industrial goods that include chemicals, construction materials and factory inputs, freight data from early June gave rise to fears that the economic recovery is shifting into a slower growth phase after the rapid run-up earlier this year.   The railroads and barge carriers report similar evidence of leveling off for these lower-value commodities.  This plateau of sorts is reinforced by several recent economic indicators at the national level, including unemployment, that show the economic recovery still has a long way to go.

Further, the question of whether our nation’s transportation infrastructure is equipped to handle any surge in cargo handling is very relevant again.  When Steve Larson, President of Caterpillar Logistics Services, testified before a Congressional committee last month about this issue, he took note of the impact that underfunded port, highway and railway facilities have on trade.  “Caterpillar has mounting concern that U.S. intermodal freight capacity will be unable to keep pace,” he asserted.

Logistics and transportation have always comprised a larger niche for the Peoria region than for comparable metro areas due to our huge investment in industrial production.  While the news from this front is generally positive, it continues to bear watching and continued monitoring.