The Nation's Freight

Introduction

As the data in this report show, the U.S. freight transportation system carries enormous quantities of goods and raw materials to support economic and industrial activities all across the nation and to meet consumer demands. The system also handles large volumes of goods traded internationally and transported to and from the United States and places throughout the world. Freight transportation touches every aspect of American economic life. Goods movement is increasingly part of a complex logistical system that serves an increasingly globalized economy. Transportation’s vital importance to the U.S. economy is underscored by the fact that more than $1 out of every $10 produced in the U.S. gross domestic product (GDP) is related to transportation activity (USDOT BTS 2005).³

Freight in America presents new estimates of freight movements in the United States that are more comprehensive than the Commodity Flow Survey (CFS) and covers domestic shipments from all the major economic sectors as well as exports and imports. It uses final data from the 2002 CFS and composite estimates compiled from many sources to fill gaps in CFS coverage by industry, commodity, and transportation mode (boxes A and B).⁴ The new estimates include a large quantity of material often not counted in domestic freight surveys, such as municipal solid waste, goods handled by the service sector, and household and office relocations.⁵ Each mode carries more freight and uses more of the freight infrastructure than previously documented.

The 2002 CFS final national data were released in December 2004 by the Research and Innovative Technology Administration’s (RITA) Bureau of Transportation Statistics (BTS) and the U.S. Census Bureau. Composite estimates in this report were subsequently developed by BTS and the Federal Highway Administration from multiple data sources to complement the CFS data and provide a better picture of commercial freight movements—both domestic and U.S.-international.

This report presents snapshots of changes in freight movements that occurred between 1993 and 2002, highlighting major trends during this period where the data allow such comparisons. Freight in America discusses recent trends in freight characteristics, such as length of haul, shipment size, and commodities shipped. The report also highlights the geography of freight movements, including freight movements at the state, regional, and metropolitan area levels; interstate freight shipments; and U.S.-international freight movements.

Composite Estimates of U.S. Freight Shipments, 2002

What the Estimates Show

The composite estimates show that American businesses transported over 19 billion tons of raw materials and finished goods in 2002 from the covered freight generating economic sectors (table 1).⁶ The value of these freight shipments in 2002, including domestic commodity movements and domestic transportation of exports and imports, was $13 trillion. These large quantities of freight shipments are diverse and include manufactured goods, electronic equipment, grain moved along the Mississippi River to Gulf Coast ports, furniture and fixtures from household and office relocations, and farm products as well as crude petroleum and natural gas shipments (see boxes B and C).

Whether transported from farms, factories, or seaports and moved by trucks, trains, vessels, pipelines, or airplanes, the freight moved in 2002 generated more than 4.4 trillion ton-miles over the nation’s freight transportation system. The shipments moved over an extensive freight transportation system supported by sophisticated information technology and operated, managed, and maintained by a large number of establishments employing a large labor force (table 2).

Comparison of the 2002 CFS and the Composite Estimates

As a proportion of the composite estimates, the 2002 CFS accounted for:

• 65 percent of the $13 trillion in total shipment value,
• 60 percent of the 19 billion tons of total shipments, and
• 71 percent of the 4.4 trillion ton-miles of estimated total commercial freight movement.

Table 3 provides the estimates of value, tons, and ton-miles of total U.S. freight shipments by transportation mode and the relative shares of the CFS component compared with the component not covered by the CFS. The composite estimates could be further revised as the estimation methods are improved.

Other differences between the CFS subtotals and the data sources used to develop the composite picture, relate to value, modal combinations, average shipment distance, and commodity mix (table 3). For example, shipments covered by the CFS were valued at $720 per ton compared with about $590 per ton of shipments measured in the non-CFS data. The non-CFS data have lower average value per ton because these data include heavier products such as crude oil, some petroleum products, and municipal solid waste. The CFS reported the average distance traveled per shipment-ton to be about 270 miles while the non-CFS calculations estimated an average of about 160 miles per ton. The proportional shares of CFS and non-CFS shipments also vary in terms of freight modes. Most imports are not covered in the CFS component, but are included in the non-CFS estimates. Hence, the portion of total estimates for water, air, and pipeline reported by the non-CFS estimate data sources exceed the estimates captured in the CFS. For instance, the non-CFS data accounted for over 53 percent of the total value of air shipments and over 80 percent of the total value of water shipments.

Table 4 shows the relative shares of the composite estimates by CFS and non-CFS components and a breakdown of the non-CFS portion. By value, the major non-CFS commodities include goods transported by the construction sector, imports, natural gas, retail sector goods, and service sector. By weight, the largest non-CFS sectors are natural gas, imports, farm-based products, and crude petroleum.

The key highlight to be gleaned from the new composite estimates is illustrated by figure 1, which shows a breakdown of the overall estimate into the proportion covered by the CFS and the non-CFS data in terms of value, weight, and ton-miles. The charts clearly illustrate the largest data gaps filled by the joint BTS and FHWA cooperative effort.

• Measured by value, the non-CFS supplemental data accounted for over 80 percent each of water and pipeline shipments, mostly because of the CFS exclusion of imports and crude petroleum; over half of air shipments; nearly one-third of truck shipments; and about one-fifth of rail shipments.
• The picture changes when measured by weight, with the non-CFS data accounting for 80 percent of the pipeline tonnage, 59 percent of the water shipments, 40 percent of the air shipments, one-third of truck shipments and, about 5 percent of rail mode shipments.
• By ton-miles, the non-CFS data accounted for nearly all of the pipeline shipments because the 2002 CFS did not cover crude petroleum and natural gas movements. These supplemental data accounted for about 42 percent of water ton-miles, 17 percent of the truck ton-miles and about 8 percent of the rail ton-miles.

Commodity Flow Survey Estimates

Major Commodity Groups ⁷

Table 5 presents the value, weight, and ton-miles as well as the relative shares for the major CFS commodities shipped by U.S. businesses.⁸ See box D for the meaning of these estimates in the CFS. Because the CFS does not cover several important commodities, such as crude petroleum pipeline movements and imports and because commodity details for sectors such as retail, services, and construction are unavailable, the CFS commodity data presented in this section underestimates the true amount of these commodities transported over our nation’s freight network.⁹

Value

In 2002, electronic, electrical, and office equipment; mixed freight; and motorized and other vehicles, including parts, led the list of commodities covered by the CFS in terms of shipment value (table 5). Businesses shipped $891 billion of electronic goods (SCTG 35) in 2002, compared to $864 billion in 1997. Mixed freight shipments, another leading commodity by value, accounted for $840 billion or about 10 percent of the CFS shipments in 2002, up from 3.4 percent in 1997.

Tonnage

By weight, the leading commodity group was gravel and crushed stone, a low-value-per-ton commodity group that is typically transported only short distances (table 5). One out of every six tons identified in the CFS was gravel and crushed stone. The shipments of 1.9 billion tons were 16 percent of the weight measured in the 2002 CFS. In 2002, other leading commodity groups by weight included coal, gasoline and aviation fuel, and nonmetallic mineral products. Although gravel and crushed stone was 16 percent of total CFS tons, shipments in this category accounted for less than 1 percent of the value and about 3 percent of the ton-miles of all CFS shipments, impacting mostly local transportation. Gravel and stone shipments traveled an average of about 57 miles per ton (figure 2).

Ton-Miles

Coal led the list of CFS commodities in terms of ton-miles in 2002 (table 5). With 686 billion ton-miles in 2002, coal accounted for about 22 percent of all CFS ton-miles and more than twice the ton-miles of cereal grains, the second leading commodity group (table 5). Coal and cereal grains were followed by prepared foodstuffs, nonmetallic mineral and products, and base metals. Coal generated the most ton-miles because, unlike gravel and stone which tends to be produced and used in the same locale, coal production is concentrated in relatively few areas and is often shipped long distances. For example, coal mined in Wyoming is transported nationwide, to coal-fired power plants in particular states, and to export locations.¹⁰ In 2002, a ton of coal was shipped 554 miles on average, far above the 269 average miles per ton for all commodities (figure 2).

Hazardous Materials Shipments

Hazardous materials shipments move by truck, train, vessel, and airplane in quantities ranging from several ounces to thousands of tons. In the United States , the U.S. Department of Transportation’s (USDOT’s) Pipeline and Hazardous Materials Safety Administration (PHMSA) has responsibility for the safe transportation of hazardous materials to industry and consumers by all transportation modes, including the nation’s pipelines. Hazardous materials are essential to the U.S. and global economy. They include fossil fuels used in cars, trucks, power plants, and heating and cooling homes and offices, as well as petrochemical feedstock. And they are also used for farming and medical applications and in manufacturing, mining, and other industrial processes.

According to Commodity Flow Survey (CFS) data, there were 2.2 billion tons of hazardous materials shipments in the United States in 2002 (table 6). Trucks carried about 53 percent of this CFS tonnage. Pipelines carried 660 million tons of shipments or roughly 30 percent of total tonnage of hazardous shipments measured in the 2002 CFS. However, the CFS does not include crude petroleum shipments. The U.S. Department of Transportation categorizes hazardous materials into nine hazard classes.¹¹ By weight, trucks carried 93 percent of Class 1 explosives, 53 percent of Class 3 flammable liquids, and 45 percent of Class 2 gases in 2002 (table 7).

Safety and security are key matters in providing hazardous materials transportation services, with shipments traveling through major metropolitan areas posing special challenges. While the overwhelming majority of shipments arrive without incident, hazardous material shipments sent by pipelines, truck, and trains are vulnerable to accident or attack.

The USDOT reviews government and industry hazardous materials transportation safety and security programs. Since September 2001, the hazardous materials shipment industry and the federal government have been implementing a “layered” system of measures affecting shippers, carriers, and drivers to reduce associated security risks. This system involves incident prevention, preparedness, and response. The USDOT and Department of Homeland Security have taken steps to enhance the security of hazardous materials transportation.¹² For example, the USDOT requires shippers and carriers to implement security plans regarding specified hazardous materials transportation. The USDOT grants encourage state and some local governmental personnel to conduct hazmat inspections and to plan and train for spills of these materials.

Distance Traveled ¹³

Most U.S. freight shipments by value and tonnage move less than 250 miles. In 2002, more than three-quarters (77 percent) of the weight (9 billion tons) of all CFS shipments and over half the value ($4.6 trillion), moved in local and short-haul shipments that are critical to metropolitan area economies, using local roads, tracks, and facilities (figure 3). But goods that move longer distances—more than 250 miles—carried 82 percent of CFS ton-miles, a slight increase from 80 percent in 1993. By weight, only 5 percent of shipments travel more than 1,000 miles. Nevertheless these shipments carried nearly one-third (32 percent) of the ton-miles in 2002, an increase from 29 percent in 1993. These longer haul shipments were transported an average of 1,780 miles per ton in 2002.

The distance shipped per ton varies greatly by commodity type. Longer haul shipments, on average, had a much higher value per ton than local and short-haul shipments (figure 4). The average value of long-haul shipments (more than 250 miles) was much higher ($1,400 per ton in 2002) than goods shipped less than 250 miles ($500 per ton). For example, goods that moved 1,000 or more miles in 2002 had an average value of over $2,000 per ton, compared with an average of $430 per ton for goods shipped less than 100 miles.

Shipment Weight ¹⁴

Growth in parcel and express courier services and an increase in consumer purchases over the Internet are influencing shipment size and contributing to a rise in smaller sized shipments. Lower weight shipments (less than 500 pounds) accounted for a 25 percent share of the value of all CFS shipments and grew 53 percent by value between 1993 and 2002 (table 8). Of the lower weight shipments, those weighing less than 100 pounds grew even faster—65 percent by value. These lower weight shipments are often high-value, time-sensitive commodities and are mostly transported by express or parcel, postal, and courier services.

Between 1993 and 2002, lower weight shipments grew only 8 percent by weight but 29 percent by ton-miles, reflecting both increased length of haul and increased frequency of shipments. In 2002, shipments of less than 500 pounds were transported 312 miles per ton on average, up 19 percent from 1993. By contrast, the average for shipments of 10,000 pounds or more was 270 miles per ton in 2002, just 7 percent higher than in 1993.

Heavier shipments (over 50,000 pounds) comprised 65 percent of the CFS ton-miles and 55 percent of tons shipped, but only 12 percent of the value of shipments in 2002, relatively similar to the 1993 and 1997 proportions. During the decade, such shipments grew 24 percent by ton-miles, 13 percent by weight, and 35 percent by value. As the number of larger sized shipments increase, their impact on our roads, rail tracks, and ports can be expected to rise.

Beyond Composite Estimates and the Commodity Flow Survey

Growth in Nation’s Freight Shipments

In this section, data were compiled from several sources to provide a current view of the trends in freight flows. Sources used, other than the CFS and the new composite estimates, include data from the U.S. Army Corps of Engineers and from the U.S. Department of Commerce’s Census Bureau.

Figure 5 shows that between 1980 and 2004, the nation’s freight ton-miles by all freight modes steadily increased, rising at an average annual growth rate of about 1.2 percent per year. This overall ton-mile information is not part of the composite estimates developed to complement the 2002 CFS. They are based on a separate BTS effort to improve available trend data on the nation’s overall ton-miles by mode going back to 1960. See the source on figure 2 for additional information.

The growth in freight movements reflects U.S. economic growth, an increase in U.S.-international merchandise trade, improvements in freight sector productivity, and the availability of an extensive multimodal transportation network in the United States .

Between 1980 and 2004, domestic air cargo (freight, express, and mail) had the most rapid growth rate among modes in ton-miles (figure 6). Air ton-miles increased more than threefold from 5 billion to nearly 17 billion revenue ton-miles. Intercity trucking and railroads grew at a lesser rate and oil pipelines remained steady. Maritime ton-miles continued to decline, largely reflecting the reduction in crude petroleum shipments by water transportation from Alaska. While domestic waterborne ton-miles declined, U.S.-international waterborne transportation grew by about 15 percent during this period.

Domestic demand for air cargo service grew the most rapidly largely reflecting growth in all-cargo carriers¹⁵, which accounted for more than two-thirds of the domestic air revenue ton-miles in 2004, expanded services. Federal Express, United Parcel Service, and DHL are the leading all-cargo carriers and provide intermodal freight services. See the section on multimodal shipments¹⁶ for further discussion of recent trends in express freight.

While air cargo grew at a faster pace than the other modes, truck and rail moved far greater tonnage and generated more ton-miles. The number of trucks used in commercial transportation (both single unit and tractor trailer combination) rose 37 percent between 1980 and 2002, increasing from 5.8 million to 7.9 million (table 9). Commercial trucks also traveled more vehicle miles, averaging about 27,000 miles per truck in 2002 compared to 19,000 miles per truck in 1980. Nationwide, the total vehicle miles of travel by single-unit trucks grew from 40 billion miles to 76 billion miles in 2002. The vehicle miles traveled by combination trucks doubled from 69 million to 139 million, during this period (USDOT FHWA 2003).

During the same period, Class I freight rail car-miles reached over 35 billion in 2003, up from 29 billion in 1980. Also, the average miles traveled annually per rail car more than tripled from 25,000 to 76,000. Rail hauls bulk commodities, such as grain and coal, over long distances as well as time-sensitive commodities, such as automobiles and parts, to domestic markets and to industrial plants in the United States and in Canada and Mexico , our top trading partners. Refrigerated rail cars can be used to transport perishable produce on tight schedules. The intermodal segment of the rail industry moves a wide assortment of goods from imported seasonal toys to lawn mowers, bicycles, and computers. Maritime vessels generated over 714 billion ton-miles in 2003, carrying bulky commodities such as wheat and other grains, ores and heavy metals, and finished products like automobiles and imported merchandise. About 85 percent, or 606 billion, of the waterborne ton-miles in 2003 was from domestic movements, a proportion that has dropped considerably since 1980. Back then, domestic shipments accounted for 91 percent (921 billion) of the over 1 trillion total maritime ton-miles (USACE 2004 and 1994).

This growth in the U.S. freight system use places pressure on transportation facilities arising from congestion, delays, capacity management, and operational bottlenecks, and it impacts the individual modes as well as multimodal freight movements. For example, according to the Federal Highway Administration, between 1980 and 2002, truck travel grew by more than 90 percent while lane-miles of public roads increased by only 5 percent (USDOT FHWA 2004). Also, over the past two decades as the rail industry consolidated, the mileage of rail roads operated by the remaining Class I railroads sharply declined from 165,000 miles in 1980 to about 99,000 miles in 2004 (AAR 2005a and 2005b).¹⁷ Despite the reduction in rail line stemming from the consolidation and mergers, rail freight tons originated rose 24 percent between 1980 and 2004, leading to industry-wide productivity growth. The continued overall growth in the use of the national freight network, relative to the infrastructure extent, could pose operational and performance challenges for goods movement. FHWA forecasts that freight volumes are expected to increase greatly by the year 2020, further straining system capacity, reliability, and productivity (USDOT FHWA 2004).¹⁸

Behind the Modal Trends

As the value of shipments has increased over time, changes have occurred in the national pattern of mode selection. The rising need for quicker deliveries of high-value products on time-definite schedules has led to the rapid growth in the value of air shipments, which as measured in the 2002 CFS grew by 90 percent from $141 billion in 1993 to $264 billion in 2002 in inflation-adjusted 2000 dollars (table 10). During this same period, the value of parcel, postal, and courier shipments, which are transported predominately by air and truck, grew 75 percent from $563 billion to $986 billion.

Heavy, low-value commodities are mostly transported at lower unit costs by rail and water modes. In 2002, according to the composite estimates, rail shipments were valued at $198 per ton on average compared to $401 per ton for water and $775 per ton for truck. Shipments by multimodal combinations were valued on average at approximately $4,892 per ton, and air-truck shipments averaged more than $88,618 per ton (table 11). The variation in the modal averages reflects the wide variation in the range of commodities moved by each of the modes. For example, trucks haul goods ranging from gravel and crushed stones, coal, and grain to electronic equipment, refrigerated perishables, pharmaceuticals, and gasoline.

Trucking

According to the composite estimates, trucking as a single mode was the most frequently used mode, accounting for an estimated 70 percent of the total value, 60 percent of the weight, and 34 percent of the ton-miles.¹⁹ In 2002, the trucking industry, both for-hire and private own-use, transported over $9 trillion worth of shipments, weighing over 11 billion tons and generating about 1.5 trillion ton-miles (table 3). Measured by ton-miles, trucking was followed by rail at 31 percent, pipeline at 15, and water with 11 percent. Trucking’s modal share by ton-miles has grown as manufacturing and services, rather than bulk commodity producing sectors such as agriculture and mining, have increased their combined share of the nation’s economic activities. Manufactured goods tend to be higher in value per ton than farming and mining products (e.g., grain and coal).

In recent years, as trucking maintained its dominance, the number of trucks traveling on the nation’s highways steadily increased and the truck fleet mix changed. While two-axle single-unit trucks are the most common commercial trucks on the nation’s roads, the number of larger combination trucks grew at a much faster rate, increasing about 59 percent over this period, compared to 30 percent for single-unit trucks (figure 7). In 2003, combination trucks accounted for 28 percent of the commercial truck fleet, up from 24 percent in 1980. These larger trucks also travel more miles per vehicle than the single-unit trucks. Combination trucks generated a total of 138 billion vehicle-miles of travel (VMT) in 2003, compared to 78 billion miles by single-unit trucks (figure 8). Since 1980, overall truck vehicle-miles have doubled from 108 billion to 216 billion in 2003. Despite this growth in truck VMT, commercial truck’s share of total highway vehicle-miles remained steady, hovering between 7.1 and 7.5 percent over this period. This was primarily because travel by all highway vehicles, including passenger cars, buses, and light trucks (e.g., pickup trucks, sport utility vehicles, and minivans) also grew at a similar pace.

Railroad

In 2004, Class I railroads in the United States transported the highest originating tonnage ever, 1.8 billion tons (AAR 2005a).²⁰ This record level tonnage reflects steady growth in rail traffic for six straight years, since 1998. Coal accounted for 43 percent of the rail tonnage in 2004, followed by chemicals and related products with 9 percent, and farm products and non-metallic products with 8 percent each. By revenue, coal accounted for 20 percent ($8.4 billion) of the Class I rail industry-wide gross revenues ($41.6 billion), followed by miscellaneous mixed shipments (mostly intermodal) with 15 percent, and chemicals and related products with 12 percent (AAR 2005a).

U.S. freight trains are carrying more loads and traveling farther than in 1980. The average freight train carried over 3,100 tons of freight in 2004, also a record high for the rail industry. By comparison, the average train load in 1980 was about 2,200 tons. While the average load per train rose, the average cargo weight per rail car dropped from 67 tons in 1980 to 61 tons in 2004, reflecting the higher growth rate of lighter freight that is typical of intermodal shipments. During this same period, the freight trains traveled more miles on average. The average length of haul was 902 miles per ton in 2004, up from 616 miles per ton in 1980. Since 1980, the length of haul has grown at an average annual rate of about 1.6 percent per year. Railroads improved on their operational efficiency as they carried more loads farther. Net ton-miles per train-hour,²¹ one measure of industry efficiency, increased 49 percent from 40,400 in 1980 to 60,300 in 2003 (AAR 2005b).

U.S. freight railroads serve almost every economic sector in the nation that handles goods, including manufacturing, mining, wholesale, and retail trade. They move not only bulk commodities but also time-sensitive goods. According to the composite estimates, rail as a single mode carried about 3 percent of nation’s freight shipments, measured by value, and 10 percent of the weight, hauling over long distances everything from coal to vegetables, lumber to orange juice, and finished automobiles and parts to grain (table 1). Rail accounted for 31 percent of the estimated total ton-miles, despite having a more spatially concentrated network than the highway system and in spite of declines in miles of rail roadway operated due to rail abandonment and industry consolidation.²² Rail’s shares of overall shipment value and weight primarily reflect the fact that low value-per-ton primary raw materials like metallic ores (e.g., bauxite), logs and wood products, and grains account for the bulk of rail shipments. Coal and chemicals alone accounted for over half (52 percent) of the rail tonnage in 2004 (AAR 2005a). Rail’s share of ton-miles reflects the high weight and the longer length of haul of the products moved by rail. For example, in 2002, coal was shipped an average of 671 miles per ton, cereal grain averaged 841 miles per ton, and fertilizers about 747 miles per ton (table 12).

Some of the largest rail freight flows by tonnage are coal shipments originating in the Powder River Basin in Wyoming and from West Virginia, Illinois, Kentucky, and Pennsylvania. These are vital economic flows because the vast majority of coal shipments are to coal-fired power plants for generating electricity. In 2003, these five states accounted for more than three-quarters (79 percent) of the total tonnage of coal originations (table 13). In 2003, the leading states for total rail tons originated included Wyoming, Illinois, West Virginia, Pennsylvania, and Kentucky. The leading states by tons terminated included Texas, Illinois, Florida, Ohio, and California (figure 9).

Waterborne

In 2003, 9 out of the top 20 freight gateways in America (land, sea, and air), in terms of value of U.S.-international merchandise freight, were maritime seaports. The leading overall freight gateway by value was the Port of Los Angeles, with $122 billion of trade. Port of Houston was the leading port by weight, handling about 126 million tons of import and export cargo in 2003 (USDOT BTS 2004). Maritime ports serve the international trade needs of every state, both coastal states with seaports as well as landlocked states that depend on the ports for their imports and exports.

Nearly 9 percent of total tonnage transported within the United States involved some form of waterborne transportation, according to the composite estimates (table 1). The total tonnage of U.S. waterborne freight, including domestic commerce and international trade, was nearly 2.4 billion tons in 2003, up from 2 billion tons in 1980 (table 14).

The maritime transportation system carries more U.S.-international freight, both in terms of tonnage and value, than other freight modes. In 2003, water transportation carried over three-quarters (78 percent) of the weight and 41 percent of the value of U.S.-international merchandise trade (USDOT BTS 2004).²³

A major global trend in maritime trade in recent decades has been the growth in use of containers for international shipments. In 2004, nearly 24 million 20-foot equivalent units (TEUs)²⁴ of merchandise moved in and out of U.S. container ports, up 79 percent from 13 million in 1995 (table 15). U.S. container ports handled an average of 65,344 TEUs of loaded containers a day in 2004. These container units arrive and leave the seaports either by rail or truck as single modes or by intermodal truck-rail combination.²⁵ Five of the top 10 container ports in the United States are on the West Coast (table 15). Between 1995 and 2004, the Port of Los Angeles had the largest growth in terms of number of TEUs, reflecting increased trade with Asia and Pacific Rim countries. Savannah, GA, showed the fastest growth in terms of annual percent change. High growth rates for Savannah and Houston reflect the strong activity in U.S. container trade with Latin American countries.

Oil and Gas Pipelines

Pipelines carry a wide variety of energy commodities, from different grades of crude petroleum and refined petroleum products such as aviation fuels, diesel, and heating oils, as well as natural gas. These pipelines transport commodities from domestic production—either in coastal waters or onshore—and from imports. Energy derived from piped crude or petroleum products is consumed at nearly every stage of the production of goods and services in the United States . The movement of products by pipelines is an elaborate and complex process, in part because of the number and types of commodities transported. Several types of oil and gas pipelines are in operation in the United States today. Gathering pipelines carry products from production fields, transmission pipelines transport products to terminals and refineries, and distribution pipelines carry products to final market and consumption points. Together, these pipelines move large quantities of hazardous liquid and gas products.²⁶

In 2003, according to recently improved BTS estimates of ton-miles, U.S. pipeline movement of crude oil, petroleum products, and natural gas produced 868 billion total ton-miles (table 16). These new pipeline estimates include shipments by natural gas liquids which accounted for about one-third of the pipeline total. When natural gas shipments are included in the pipeline total, oil and gas pipelines accounted for approximately 20 percent of total freight ton-miles by all modes in 2003 (14 percent from oil pipelines and 6 percent from gas pipelines).

Pipelines move large volumes of both domestic and imported petroleum and gas products. For example in 2004, the United States imported over 4.7 billion barrels of crude oil and petroleum products, and pipelines helped to transport a large proportion of these on part of the journey from the points of entry to refineries, terminals, and markets for final consumption.²⁷ Additionally there was over 3.6 million cubic feet of natural gas imports from Canada into the United States in 2004, up from 1.4 million cubic feet in 1990 (USDOE EIA 2005).

Air Cargo

In 2004, all-cargo carriers and other commercial airlines generated over 37 billion freight revenue ton-miles (figure 10). Since 1980, air freight revenue ton-miles grew faster in the international market (averaging 8 percent per year) than in the domestic market (6 percent per year). Ton-miles from the international market now exceed those from the domestic market, having overtaken the domestic segment in 2000. During this period, total freight revenue ton-miles grew even faster (7 percent annually) than total revenue passenger miles (4 percent annually) (table 17).

Because commodities that move by air tend to be high in value, U.S.-international air cargo averaged $82,000 per ton in 2004. And because it is so high in value, air cargo accounted for a much larger proportion of the value (27 percent) than the weight (less than 1 percent) of overall U.S.-international merchandise trade (USDOT BTS 2004).

Air cargo also accounts for a much smaller share of the weight and ton-miles of U.S. domestic and international freight combined. According to the composite estimates, air freight accounted for about 4 percent of the value and less than one percent of the tonnage and ton-miles in 2002 (table 1). Although air’s share of the tonnage and ton-miles is relatively small, growth in air freight creates demand for more truck and intermodal services because almost all air cargo shipments begin and end their journey by truck.

Major U.S. airports serve as gateways of exit and entry for air cargo originating in or destined for markets located in large metropolitan areas. In 2004, John F. Kennedy (JFK) International Airport, in New York, was the leading overall gateway for U.S. international freight by value. It handled $125 billion of air cargo, accounting for 6 percent of the $2.2 trillion in total U.S. international goods trade (USDOT BTS 2005). JFK was followed in 2004 by the 2003 leader, the Port of Los Angeles ($121 billion) and Port of Long Beach ($121 billion) in terms of value of U.S.-international freight. In terms of weight, Anchorage, AK, was the leading U.S. air gateway in 2004, handling 28 percent of the 9.5 million tons of international air cargo transported through U.S. airports in 2004.²⁸Memphis International Airport was the lead hub airport for express and overnight air shipments.

Multimodal ²⁹

In 2002, according to the CFS over $1 trillion worth of goods were transported multimodally, including: ³⁰

• parcel, U.S. Postal Service, and courier,
• truck and rail
• truck and water, and
• rail and water.

Between 1993 and 2002, the value of these multimodal shipments measured in the CFS grew 63 percent in inflation-adjusted terms, from about $662 billion to about $1.1 trillion (table 10). These shipments accounted for 13 percent of the value of the CFS shipments in 2002, about 2 percent by the weight, and about 7 percent by ton-miles of shipments. Two large market segments of the multimodal shipments by value are parcel and courier services and intermodal truck and rail. Both have experienced growth and industry changes in recent years. As defined in the CFS, multimodal shipments exclude commodities transported by air (which almost always require movements by truck from the shipment origin to the airport and from the airport to the shipment destination).³¹

Parcel and courier service—In 2002, according to the CFS, over $986 billion worth of goods shipped by U.S. businesses were transported by the parcel, postal, and courier service, which is treated as a separate “mode” of transportation in the CFS (table 10). Between 1993 and 2002, these shipments grew about 75 percent by value in inflation-adjusted terms. Goods moved by this industry, such as electronics, pharmaceuticals, textiles, and auto parts, are typically higher value relative to their weight and averaged over $38,000 per ton in 2002.

In 2002, parcel and express shipments measured by the CFS traveled an average of 745 miles per ton, reflecting the multimodal nature of the services offered by the major parcel and express carriers, including Federal Express (FedEx), United Parcel Service (UPS), and DHL.

Intermodal truck and rail—According to the Rail Waybill data, the classic intermodal rail and truck combination (called rail intermodal) moved shipments weighing 173 million tons in 2002, an increase of 47 percent from 118 million tons in 1993.³² If it is assumed that these goods would have otherwise been carried by only trucks in 50,000 lb payloads, then the intermodal traffic handled by rail in 2002 essentially removed 6.9 million large truck trips from our highways for a major part of the distance traveled by these ­shipments.

In 2004, intermodal rail-truck service handled about 11 million trailers and containers, according to the Association of American Railroads (AAR) (figure 11). In 2003, for the first time ever, intermodal freight surpassed coal in terms of revenue for U.S. Class I railroads, accounting for about 23 percent of Class I carriers gross revenue. In 2004, nearly three-quarters (74 percent) of the rail-truck intermodal traffic was in containers.³³ Trailers accounted for the remainder (AAR 2005b). Rapid growth in use of containers for transportation of U.S.-international merchandise trade is the primary factor behind the rising trend in U.S. rail-truck intermodal shipments. Imports account for the majority of this intermodal activity.

Parcel and Express Shipments

During the past two decades, growth in the number of parcels shipped has transformed America’s parcel industry and its impact on the freight transportation system. Increasing global integration of the U.S. economy has become a significant force in shaping the nation’s freight transportation system. A truly multimodal industry, parcel and express plays an important role in the American economy as it enables the transportation of time-sensitive shipments that are critical to the competitiveness of U.S. businesses domestically and abroad.

The parcel industry shipped an estimated 12 percent of CFS shipments by value, weighing 26 million tons in 2002. The top commodities shipped by parcel couriers include electronic and office equipment, miscellaneous manufactured products, textiles, mixed freight, and printed products.

Shipments by three of the major U.S. parcel couriers, the United States Postal Service (USPS), Federal Express (FedEx), and United Parcel Service (UPS),³⁴ have dramatically increased in past years. USPS shipments increased from 102 billion pieces of mail (i.e., packages, letters, magazines, etc.) in 1980 to 206 billion in 2004 (USPS 2005). FedEx and UPS also experienced large growth in their shipments. From 1980 to the 2004, FedEx shipments grew from 68,000 to 3.2 million parcels shipped in average daily package volume (FEDEX 1 2005), while UPS shipments grew from 3.5 billion packages shipped in 2000 to 3.6 billion packages in 2004 (UPS 2004).³⁵

FedEx processes millions of shipments daily on route to addresses within the United States and more than 220 countries. In 2004, the average weight of a FedEx package was 7.4 lb (FEDEX 2 2005). With an average daily delivery volume of 14.1 million packages and documents, delivering parcels internationally to more than 200 countries, UPS provides services to more than 7.9 million customers daily (UPS 2005).

The parcel sector pioneered a “hub and spoke” streamlined model of parcel delivery, with their major hubs located near large demographic centers of the United States (see figure 12). When a package is shipped by a private parcel carrier it is sent to an origin processing facility, then to an origin regional center, and from there to its destination regional center, destination processing facility, and finally to its recipient.

FedEx, headquartered in Memphis, TN, accounts for nearly all of the freight movement processed by the Memphis International Airport. UPS is headquartered in Louisville, KY, and accounts for virtually all freight traffic handled by Louisville’s Standiford Field. The top airport for air cargo by DHL, another major parcel courier, was the Greater Cincinnati Airport of Ohio, where the firm has two ground-air multimodal freight centers. USPS has several regional ground distribution hubs.