Intermodal Market Trends & Statistics - 4th Quarter 2016 - 11

Intermodal Market Trends & Statistics
gains slowed a bit over the second half
of 2016, but even in December, net job
gains were above 150,000, the level
required to keep pace with population
growth. And although net job gains
slowed a bit, wage growth trended
higher through the second half of 2016,
albeit slowly.
One bright spot in the U.S. economy
was vehicle sales, which hit a 15-year
high of 18.4 million sales on a seasonally adjusted, annualized basis in
December. Although vehicle sales
outperformed expectations at the
end of the year, home sales disappointed. Both new and existing home
sales turned down from November to
December. Housing starts did comparatively well at the end of 2016, although
there was considerable volatility from
month to month. Still, there are reasons to be concerned about the housing market. Interest rates are expected
to rise in 2017 and government policy
has already changed to make loans
more expensive for many Americans.
Although consumer fundamentals
are strong, these changes could slow
home buying in 2017.
The Canadian economy sent mixed
signals at the end of the year. Very
positive job growth followed a report
that monthly GDP shrank in October
after four months of growth. Canada
also registered its first trade surplus in
December, after more than two years of
deficits. Analysts now predict that 2016
GDP will come in below the Bank of
Canada forecast of 1.5% growth.
Mexico had a rough quarter. Gas
prices rose up to 20% as the effects
of energy reform began and the peso
slumped to 21.61 per United States dollar, a new low. Between the currency
devaluation and increased gas prices,
inflation surged to 4.4%, well above the
Bank of Mexico target rate. However,
the biggest concern for Mexican officials is the future of trade policy, as the
United States begins a new presidential
term. For these reasons, both the IMF
and World Bank downgraded their forecasts for Mexican growth.
U.S. and Canadian Container Trade
U.S. imports ended 2016 with a
bang, with a jump of 8.3% in Q4. To
some extent, the strong gains in Q4
canceled out the less than 1.0% growth
in Q2 and Q3: over the whole of 2016,
imports rose 3.7%. This growth rate is

U.S. Economic Indicators
15Q4

16Q1

16Q2

16Q3

16Q4

Gross Domestic Product (SAAR)

0.9%

0.8%

1.4%

3.5%

2.2%

Merchandise Imports (SAAR)

0.7%

-1.3%

0.0%

0.5%

5.5%

Industrial Production - Mfg. (vs. LY)

0.1%

0.6%

0.2%

-0.1%

0.4%

Capacity Utilization - Mfg.

75.7% 75.7% 75.4% 75.3% 75.4%

Retail Sales (Excl. Autos, vs. LY)

1.0%

2.4%

2.9%

2.4%

4.0%

Inventory/Sales Ratio - All Business

1.39

1.41

1.40

1.39

1.38

Housing Starts (Millions, SAAR)

1.13

1.15

1.16

1.14

1.22

Trade Weighted Value $ (1973=100)

97.7

99.3

96.9

97.7

101.1

16Q3

16Q4

Canadian Economic Indicators
15Q4

16Q1

16Q2

0.5%

2.7%

-1.3%

3.5%

2.0%

Imports (SAAR)

-6.3%

2.3%

1.4%

3.3%

2.9%

Exports (SAAR)

-2.1%

9.0% -14.8%

8.9%

3.7%

Industrial Production - Mfg. (vs. LY)

-2.9%

-1.0%

-2.7%

-0.2%

1.1%

2.2%

5.5%

3.5%

2.4%

2.9%

Gross Domestic Product (SAAR)

Retail Sales (vs. Last Year)
Housing Starts (Thousands, SAAR)

173.4
$0.75

U.S. $ / Canadian $

180.3

185.9

$0.73

$0.78

189.7
$0.77

201.2
$0.75

Mexican Economic Indicators
15Q4

16Q1

16Q2

16Q3

16Q4

1.8%

1.9%

0.2%

4.0%

1.9%

Imports (SAAR)

-3.6%

-4.3%

-0.1%

9.1%

0.2%

Exports (SAAR)

0.1%

-6.2%

-8.7% 15.6%

7.8%

Industrial Production - Mfg. (vs. LY)

0.1%

0.5%

Gross Domestic Product (SAAR)

Mexican Peso / U.S. $

-0.2%

-0.8%

-0.3%

$16.76 $18.04 $18.09 $18.78 $19.80

SAAR = Seasonally Adjusted Annual Rate of growth from prior quarter.Some Q4
2016 figures are preliminary estimates.
actually a bit low given the strength of
the U.S. dollar and consumer spending.
In 2015, U.S. imports gained 5.1%.
Full Q4 U.S. export data is not yet
available, however the available data
suggests that Q4 was a good quarter
for exports as well. Exports through
the ports of L.A. and Long Beach
jumped 11.7% from the previous year
in Q4. Over the whole of 2016, exports
through the ports of L.A. and Long
Beach gained 5.2%. Again, the strong

growth rate in exports is a bit surprising given the strength of the U.S. dollar.
However, total U.S. exports fell 5.3% in
2015, so, to some extent, 2016's strong
growth may be due to weaker comparisons.
Full Canadian and Mexican volume
data is not yet available. However, the
data that is available suggests similarly
strong export growth as in the U.S., but
weaker import growth.

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