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November 12 2018

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38 The Journal of Commerce | November 12 2018 www.joc.com Surface Transportation containers were not able to handle. Intermodal rail volume is 50.6 per- cent international and 49.4 percent domestic, Gross said. There is no doubt that trade policy uncertainties involving US imports from China, the North Amer- ican Free Trade Agreement partners of Canada and Mexico and the Euro- pean Union, resulted in front-loading of shipments this summer, said Chris Christopher, executive director of economics at IHS Markit, parent company of The Journal of Commerce. However, tariffs on consumer mer- chandise and manufacturing inputs are forcing prices higher, which will impact spending in the new year if tariffs continue, he said. Front-loading of imports is having quite a noticeable impact on the timing of import volumes this Peaking prices Tariffs lead to front-loading of shipments and tight capacity sparks increased rates By Bill Mongelluzzo An increase in trailer-on-flatcar volume may indicate trailers have picked up the demand that domestic containers were not able to handle. Shutterstock.com have much of an impact on SNCF's freight unit, which has been steadily losing traffic to private firms, includ- ing foreign operators, after the EU liberalized the rail cargo market. There have been some positive signs, however, with growth in European rail freight transport in 2017 continuing into this year, particularly in Poland and Sweden. "Development was supported by strong demand for capital goods and US TRUCK AND intermodal rail volumes, and freight rates, are at or near their peak levels of the year. Although growth will continue into 2019, it will moderate due to eco- nomic factors and trade tensions. Two major developments have produced unusually strong price increases in international and do- mestic freight movement this year, analysts told more than 370 attend- ees of the JOC Inland Distribution Conference in Oak Brook, Illinois, last month. Capacity shortages, more than trade growth, have forced prices higher. Also, Trump adminis- tration tariffs on imports from major US trading partners put into effect in the summer, and the fear of another increase on imports from China on Jan. 1, 2019, to 25 percent, have caused a front-loading of shipments, distorting the normal trade flows. Supply side pressures, primarily because of driver shortages, caused a double-digit increase in spot truck- ing rates this year, said Lee Klaskow, senior analyst, transportation and logistics at Bloomberg Intelligence. Truckload rates increased 17.7 per- cent, and less-than truckload spot rates rose 14.1 percent so far in 2018, he said. Klaskow expects a return to single-digit increases in 2019. Analyst and consultant Lawrence Gross said that although intermodal volumes through summer were strong, in part because of some diversion from truck, the Septem- ber numbers indicate a slowdown may have begun. The 7 percent growth this summer was down to 2.2 percent in September. "There is a bit of a slowdown, although it's still growing," he said. The increase in trailer-on-flatcar volume this year is an indication that trailers have picked up the demand that domestic dynamic trading. Positive momentum was generated mainly from trans- port through the North Sea ports of Antwerp, Rotterdam, and Hamburg," according to Deutsche Bahn. Rail freight shuttles through the cross-channel tunnel linking the UK and France that compete with roll-on, roll-off ships are breaking records, despite fears that London and Brussels won't reach agreement over Brexit — the UK's exit from the International and domestic freight volumes have or will peak this year, and growth will moderate noticeably next year. Rail freight shuttles through the cross-channel tunnel linking the UK and France that compete with roll-on, roll-off ships are breaking records.

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