US rail freight volumes delivered a split performance last month (June). Conventional wagonload traffic posted a fourth straight month of growth. However, intermodal (which in the US interpretation includes ‘piggyback’ road trucks on trains) slipped into negative territory for the first time in nearly two years. The figures, released by the Association of American Railroads (AAR), signal a freight market navigating uncertainty, even as parts of the domestic economy show signs of resilience.
For operators and logistics planners in North America, the mixed data underline the sector’s dual exposure. Its health sits between global supply chains and internal industrial trends. For example, some core commodities such as grain and coal remain buoyant. However, weakening international flows are weighing down containerised rail movements, and industrial indicators continue to flash caution.
Wagonloads show recovery momentum
Wagonload (“carload”) freight saw a 2.1% year-on-year increase in June, with an average of 226,259 units moved per week. That’s the best monthly performance since 2021. The growth was led by gains in grain, coal and chemicals, with ten out of twenty key commodity groups recording positive trends. The overall carload sector was up 4.8% for Q2 and 2.4% year-to-date.
Grain traffic stood out with an 11.3% increase, attributed to stronger corn exports and reconfigured international markets following tariff shifts. Coal also rose 2.4% in June, marking a fourth month of consecutive growth, though AAR noted this largely reflected a weaker base last year. Chemicals remained a high-volume category, slightly down year-on-year in June but hitting a record high for the first half of a calendar year.
Intermodal slowdown weighs on volumes
The international market, heavily affected by unpredictable US economic policy, has impacted on the rail freight sector. Intermodal traffic declined 2.9% year-on-year in June, with overall volumes dropping by over 31,000 units. That’s the first annual fall since August 2023. Weekly averages of 260,834 originations came in below long-term expectations, as port activity and consumer-driven demand lost momentum. “Looking ahead, intermodal performance will hinge on a range of factors,” the AAR stated, “including developments impacting global supply chains and the strength of consumer-driven freight demand.”
The intermodal setback is significant for rail operators, particularly those focused on long-haul domestic container services and port-to-inland rail corridors. Slower throughput at maritime gateways and inventory corrections across retail sectors continue to depress rail container demand.
Signs of caution from manufacturing indicators
The broader industrial outlook remains tepid. The ISM Manufacturing PMI (Purchasing Managers Index – often characterised as a valid indicator of economic prospects) edged up to 49.0% in June, still below the 50% expansion threshold. The AAR’s own industrial products category posted just a 0.4% annual gain, with cumulative volumes slightly down over H1 2025. For the Association and its members, that’s far from encouraging.
The Freight Rail Index (FRI)—which excludes coal, grain and intermodal traffic—slipped 0.5% between May and June, the weakest monthly performance in over a year. However, adjusted carloads excluding coal and grain rose 0.7%, indicating pockets of demand.
Rail at the crossroads of global and domestic shifts
Rail continues to mirror the broader uncertainties in the US economy. “In recent months, the US economy has defied easy characterisation,” said the AAR. “[It’s] caught between signals of underlying strength and uncertainty regarding the road ahead.”
The second half of 2025 presents a complex challenge. With intermodal volumes softening and carload sectors showing selective resilience, the freight rail industry is caught between crosscurrents of global volatility, domestic re-industrialisation, and shifting consumer patterns. Strategic agility, particularly among Class I operators and intermodal partners, will be key to navigating the months ahead.