Appendix A: IHS/Global Insight TRANSEARCH Commodity Flow … · Insight TRANSEARCH Commodity Flow...

Appendix A: IHS/Global Insight TRANSEARCH Commodity Flow Report Revised, November 2011

Commodity Flows in the Cincinnati Region

Prepared for Parsons Brinckerhoff, Inc.


Table of Contents

INTRODUCTION ............................................................................................................. 1

OVERVIEW OF ALL MODES COMMODITY FLOWS ............................................................................. 1 TRUCK FREIGHT FLOWS ................................................................................................................ 9

Overview ................................................................................................................................................ 9 Inbound ................................................................................................................................................ 12 Outbound ............................................................................................................................................. 16 Through ................................................................................................................................................ 21 Truck Flows by Highway ...................................................................................................................... 24

RAIL FREIGHT FLOWS ................................................................................................................. 30 Overview .............................................................................................................................................. 30 Inbound ................................................................................................................................................ 31 Outbound ............................................................................................................................................. 35

AIR CARGO ................................................................................................................................ 39 Overview .............................................................................................................................................. 39 Inbound ................................................................................................................................................ 41 Outbound ............................................................................................................................................. 43

BARGE FREIGHT FLOWS ............................................................................................................. 45 Overview .............................................................................................................................................. 45 Inbound ................................................................................................................................................ 46 Outbound ............................................................................................................................................. 49

HAZARDOUS MATERIALS ............................................................................................................. 52

TRUCKLOAD RATES .................................................................................................. 55

APPENDIX A-1: TRANSEARCH® METHODOLOGY .................................................. 57

TRANSEARCH®: AN INTRODUCTION ............................................................................................ 57 TRANSEARCH® BASE YEAR DEVELOPMENT ................................................................................ 57 TRANSEARCH® FORECAST ........................................................................................................ 59

APPENDIX A-2: BEA COUNTY COMPOSITION ......................................................... 60

List of Tables

Table 1: Total Freight Flows by Mode – All Modes, 2009-2040 ................................................................... 2

Table 2: Total Freight Flows by Direction – All Modes, 2009-2040 .............................................................. 3

Table 3: Top Commodities in Cincinnati Region by Volume, 2009, 2040 .................................................... 8

Table 4: Top Commodities in Cincinnati Region by Value, 2009, 2040 ....................................................... 8

Table 5: Truck Freight Flows by Direction, 2009-2040 ................................................................................. 9

Table 6: Top Truck Commodities in Cincinnati Region by Volume, 2009, 2040 ........................................ 11

Table 7: Top Truck Commodities in Cincinnati Region by Value, 2009, 2040 ........................................... 11

Table 8: Inbound Truck Freight Flows by County, 2009-2040 .................................................................... 13

Table 9: Origins of Inbound Truck Freight, 2009-2040 ............................................................................... 14


Table 10: Top Inbound Truck Commodities by Volume, 2009, 2040 ......................................................... 15

Table 11: Top Inbound Truck Commodities by Value, 2009, 2040 ............................................................ 15

Table 12: Outbound Truck Freight Flows by County, 2009-2040 ............................................................... 18

Table 13: Destinations of Outbound Truck Freight, 2009-2040 .................................................................. 19

Table 14: Top Outbound Truck Commodities by Volume, 2009, 2040 ....................................................... 20

Table 15: Top Outbound Truck Commodities by Value, 2009, 2040 .......................................................... 20

Table 16: Top Ten Through Truck Lanes by Volume, 2009, 2040 ............................................................. 22

Table 17: Top Ten Through Truck Lanes by Value, 2009, 2040 ................................................................ 22

Table 18: Top Through Truck Commodities by Volume, 2009, 2040 ......................................................... 23

Table 19: Top Through Truck Commodities by Value, 2009, 2040 ............................................................ 23

Table 20: Rail Traffic by Direction, 2009-2040 ............................................................................................ 31

Table 21: Origins of Inbound Rail Traffic, 2009-2040 ................................................................................. 33

Table 22: Top Inbound Rail Commodities by Volume, 2009, 2040 ............................................................ 34

Table 23: Top Inbound Rail Commodities by Value, 2009, 2040 ............................................................... 34

Table 24: Destinations of Outbound Rail Traffic, 2009-2040 ...................................................................... 37

Table 25: Top Outbound Rail Commodities by Volume, 2009, 2040 ......................................................... 38

Table 26: Top Outbound Rail Commodities by Value, 2009, 2040............................................................. 38

Table 27: Air Cargo in the Cincinnati Region, 2009-2040 .......................................................................... 39

Table 28: Air Cargo by Origin, 2009-2040 .................................................................................................. 41

Table 29: Top Inbound Air Commodities by Volume, 2009, 2040 .............................................................. 42

Table 30: Top Inbound Air Commodities by Value, 2009, 2040 ................................................................. 42

Table 31: Air Cargo by Destination, 2009-2040 .......................................................................................... 43

Table 32: Top Outbound Air Commodities by Volume, 2009, 2040 ........................................................... 44

Table 33: Top Outbound Air Commodities by Value, 2009, 2040 .............................................................. 44

Table 34: Barge Traffic by Direction, 2009-2040 ........................................................................................ 46

Table 35: Inbound Barge Traffic by County, 2009-2040 ............................................................................. 46

Table 36: Origins of Inbound Barge Traffic, 2009-2040 .............................................................................. 47

Table 37: Top Inbound Barge Commodities by Volume, 2009, 2040 ......................................................... 48

Table 38: Top Inbound Barge Commodities by Value, 2009, 2040 ............................................................ 48

Table 39: Outbound Barge Traffic by County, 2009-2040 .......................................................................... 49

Table 40: Destinations of Outbound Barge Traffic, 2009-2040 .................................................................. 50

Table 41: Top Outbound Barge Commodities by Volume, 2009, 2040 ...................................................... 51

Table 42: Top Outbound Barge Commodities by Value, 2009, 2040 ......................................................... 51

Table 43: Hazardous Materials Traffic by Mode, 2009-2040 ...................................................................... 52

Table 44: Hazardous Materials Highway Flows by Direction, 2009-2040 .................................................. 54

Table 45: Hazardous Materials Barge Flows by Direction, 2009-2040 ...................................................... 54

Table 46: Truckload Freight Rates, October 15, 2010 ................................................................................ 56


List of Figures

Figure 1: Direction of Freight Traffic in the Cincinnati Region ...................................................................... 3

Figure 2: Bureau of Economic Analysis Regions Eastern US ...................................................................... 4

Figure 3: Bureau of Economic Analysis Regions Western US ..................................................................... 5

Figure 4: Origins of Inbound Freight – All Modes, 2009 ............................................................................... 6

Figure 5: Destinations of Outbound Freight – All Modes, 2009 .................................................................... 7

Figure 6: Routed Total Outbound and Inbound Truck Tons, 2009 ............................................................. 10

Figure 7: Origins of Inbound Truck Freight, 2009 ....................................................................................... 12

Figure 8: Routed Inbound Truck Tons, 2009 .............................................................................................. 12

Figure 9: Destination of Outbound Truck Freight, 2009 .............................................................................. 16

Figure 10: Routed Outbound Truck Tons, 2009 ......................................................................................... 17

Figure 11: Truck Flows Through the Cincinnati Region, 2009 .................................................................... 21

Figure 12: I-71 Truck Flows, 2009 .............................................................................................................. 24

Figure 13: I-71 Volumes, 2009-2040 .......................................................................................................... 25


Figure 15: I-74 Volumes, 2009-2040 .......................................................................................................... 27


Figure 17: I-75 Volumes, 2009-2040 .......................................................................................................... 29

Figure 18: Rail Traffic by Type, 2009 .......................................................................................................... 30

Figure 19: Inbound Rail Traffic by Type, 2009 ............................................................................................ 32

Figure 20: Origins of Inbound Rail Flows, 2009 .......................................................................................... 32

Figure 21: Outbound Rail Traffic by Type, 2009 ......................................................................................... 35

Figure 22: Destinations of Outbound Rail Flows, 2009 .............................................................................. 36

Figure 23: Air Cargo Origins and Destinations, 2009 ................................................................................. 40

Figure 24: Barge Flows, 2009 ..................................................................................................................... 45

Figure 25: Hazardous Materials Flows by Truck, 2009 .............................................................................. 53

1 Commodity Flows in the Cincinnati Region

INTRODUCTION

Presented in this report is an analysis of current and forecast freight flows in the Cincinnati and Dayton regions out to 2040. The Cincinnati region is comprised of Boone County, Kentucky; Butler County, Ohio; Campbell County, Kentucky; Clermont County, Ohio; Dearborn County, Indiana; Hamilton County, Ohio; Kenton County, Kentucky and Warren County, Ohio. Greene, Miami and Montgomery counties in Ohio comprise the Dayton region.

The data provided in this report is derived from IHS Global Insight’s 2009 TRANSEARCH® database and forecast. TRANSEARCH® is a comprehensive database of North American freight flows that is built from more than a hundred industry, commodity and proprietary data exchange sources. The freight flows are forecast based on expected growth in commodity volumes, driven by output, employment and consumption factors within each county. A more detailed explanation of the TRANSEARCH® methodology is provided in Appendix A-1 to this report.

Freight flows in the Cincinnati and Dayton regions are analyzed by mode of transport as well as the origin and destination of the flows. The commodity components of freight traffic are also provided and sized by value and volume.

Truck, barge and air freight flows were analyzed using county-level data. Truck flows are analyzed most extensively and include estimates of routed traffic flowing through the study areas. Truck traffic is also examined at a greater level of detail to capture impacts on major interstate highways in the two regions. However, due to non-disclosure agreements with major railways, rail data is only available at the Business Economic Area (BEA) level, instead of the county level.1 Since data on traffic by individual railroads was not available, rail flows could not be routed along the railway network, and through rail traffic is thus not analyzed in this report. Rail traffic passing through the study areas may however comprise a significant portion of total rail traffic.

Freight volumes will rise in both regions due to growth in population and economic activity. By 2040, they are expected to roughly double in the Dayton area and to increase by more than 50 percent in the Cincinnati region. However, the growth will not be even across all modes, commodities and sources. Understanding the nature of freight flows within each metropolitan region will thus help planners and policy makers to better prioritize infrastructure investment decisions in ways that will facilitate and accommodate future sources of increasing freight traffic.

OVERVIEW OF ALL MODES COMMODITY FLOWS

As in any other region, the majority of freight in the Cincinnati area is transported by truck, which moves about 70 percent of freight tonnage in the United States. In the Cincinnati area an even higher proportion of freight moves by truck; about 82 percent of volume and 90 percent of value, as shown in Table 1 below. Due to Cincinnati’s position on the Ohio River, barge comprises the second highest mode by volume, although rail is the second largest mode by value.

1 Counties comprising the Cincinnati and Dayton BEAs are listed in Appendix A-2 to this report.


Air cargo does not comprise a significant share of the region’s freight transport, but is expected to be the fastest growing mode over the next thirty years. Overall freight volumes are expected to grow by about 50 percent during this time period, but the value of this freight will more than double in constant 2009 dollars. These growth patterns are largely driven by the fact that heavier, lower-value per ton commodities such as aggregate and coal are expected to grow at a slower rate than lighter, higher-value per ton commodities such as consumer goods and electronics. They also explain the faster growth rates for truck and air than for rail and water, which primarily transport heavier bulk commodities.

Table 1: Total Freight Flows by Mode – All Modes, 2009-2040

Mode 2009 2015 2020 2030 2040

2009-2040

CAGR1

Tons (Thousands)

Air 112 147 169 214 259 2.7%

Rail 17,778 20,550 20,712 20,513 21,309 0.6%

Truck 185,811 212,766 227,035 258,781 302,093 1.6%

Water 21,649 22,836 22,706 22,450 22,848 0.2%

Total 225,350 256,298 270,623 301,958 346,509 1.4%

Value (Millions)

Air $660 $946 $1,118 $1,482 $1,831 3.3%

Rail $17,876 $19,527 $20,577 $21,981 $24,797 1.1%

Truck $217,550 $271,989 $301,134 $379,976 $491,952 2.7%

Water $6,117 $7,232 $7,460 $7,501 $7,716 0.8%

Total $242,203 $299,694 $330,289 $410,941 $526,296 2.5%

About 44 percent of the freight in the Cincinnati region moves through the area. Inbound freight comprises another 30 percent, outbound freight a further 20 percent, with the remaining six percent of freight moving within the region, as shown in Figure 1 below. Over the forecast period, outbound freight is expected to be the fastest growing by volume, although inbound freight will grow faster by value.

These expected growth patterns suggest that Cincinnati’s growth and consumption patterns will lead it to import commodities of slightly higher value per ton than it exports to other regions. This is due in large part to the growth in consumer product volume, especially imports from foreign sources, which are generally of higher value than the commodity mix of the Cincinnati area exports. This is a general trend predicted for the U.S. and other developed countries, which is reflected in the Cincinnati area forecast.

1 “CAGR” refers to Compound Annual Growth Rate, or the fixed rate of growth over the period.


Figure 1: Direction of Freight Traffic in the Cincinnati Region

Table 2: Total Freight Flows by Direction – All Modes, 2009-2040

Direction 2009 2015 2020 2030 2040

2009-2040

CAGR

Tons (Thousands)

Inbound 66,895 74,901 77,985 84,303 93,525 1.1%

Intra 13,663 15,051 16,207 19,243 23,012 1.7%

Outbound 45,145 54,200 58,476 67,198 78,324 1.8%

Through 99,647 112,146 117,954 131,215 151,649 1.4%

Total 225,350 256,298 270,623 301,958 346,509 1.4%

Value (Millions)

Inbound $53,079 $65,220 $72,834 $91,753 $117,214 2.6%

Intra $4,287 $3,386 $3,859 $5,058 $6,811 1.5%

Outbound $52,367 $63,485 $70,127 $86,676 $108,593 2.4%

Through $132,469 $167,603 $183,470 $227,454 $293,678 2.6%

Total $242,202 $299,694 $330,290 $410,941 $526,296 2.5%

Throughout this report, data is presented by Bureau of Economic Analysis (BEA) regions. BEAs equate generally to metropolitan markets, defined so as to include all the land area of the United States. Figure 2 and Figure 3 depict the BEAs used throughout this report.

44%

30%

20%

6%

Through Inbound Outbound Within


Figure 2: Bureau of Economic Analysis Regions, Eastern US


Figure 3: Bureau of Economic Analysis Regions, Western US


Figure 4 below visualizes the distribution of origin Bureau of Economic Analysis (BEA) regions for freight entering the Cincinnati area by all modes. Blocks of color represent annual tonnage of freight, dark blue represents 10,000 annual tons or less, light blue represents 10,000 – 29,000, green represents 29,000 to 80,000, yellow represents 80,000 to 167,000, orange represents 167,000 to 530,000, and red represents 530,000 annual tons and above. The main sources of inbound freight are the surrounding Midwestern region, the New York/New Jersey area including the area’s ports and BEAs containing ports in the Houston and New Orleans areas. California and Washington are also significant sources of inbound freight, but the majority of inbound freight is arriving from the eastern half of the United States.

Figure 4: Origins of Inbound Freight – All Modes, 2009


Figure 5 in turn provides an overview of the main destinations or exit points to global markets of freight originating in the Cincinnati region. As for inbound freight, the main recipients of Cincinnati’s freight are neighboring regions in the Midwest. Cincinnati’s freight also travels to population centers and ports the Northeast, Southern California, Houston and New Orleans.

Figure 5: Destinations of Outbound Freight – All Modes, 2009

Table 3 and Table 4 present the commodity mix of the freight moving throughout the Cincinnati area1. Secondary traffic, or movements between warehouses and/or retail locations, comprises the largest commodity by value. Over the forecast period, it will also become the largest commodity by volume, growing by an average annual rate of just over 3 percent.

Global Insight’s econometric forecasting model predicts that the tonnage of farm products will decrease by about 5 million tons or by an average annual rate of -0.4 percent, primarily concentrated among truck movements in the Midwest region. Because farm products (e.g., grain) have a low value per ton, the increasing cost of fuel over the forecast period, as well as other trucking cost increases, will impact the viability of moving these products by truck. While this is forecast to cause some shift of farm product transportation to rail, the overall volume transported will decrease.

1 This includes commodities traveling in and out by all modes. For trucks, it also included commodities traveling through the region.


Coal will also see a small drop in volume over the forecast period, due to predicted shifts to sources of low-sulfur coal over the forecast period. Furniture and fixtures will experience some of the fastest growth in tonnage, albeit from a low base, whereas electrical equipment – a commodity group that has a strong manufacturing base in Cincinnati -will be one of the fastest growing commodities by value.

Table 3: Top Commodities in Cincinnati Region by Volume, 2009, 2040 (Thousands)

2009 2040

STCC1 Commodity Description Tons %

Total STCC Commodity Description Tons % Total

1 Farm Products 50,852 22.6% 50 Secondary Traffic 77,213 22.3%

50 Secondary Traffic 28,249 12.5% 14 Nonmetallic Minerals 45,464 13.1%

14 Nonmetallic Minerals 26,274 11.7% 1 Farm Products 45,140 13.0%

20 Food or Kindred Products 19,894 8.8% 20 Food or Kindred Products 34,439 9.9%

11 Coal 17,311 7.7% 28 Chemicals or Allied Products 19,990 5.8%

29 Petroleum or Coal Products 15,953 7.1% 29 Petroleum or Coal Products 19,589 5.7%

28 Chemicals or Allied Products 15,092 6.7% 32 Clay, Concrete, Glass or Stone 13,852 4.0%

33 Primary Metal Products 9,614 4.3% 11 Coal 13,337 3.8%

24 Lumber or Wood Products 7,751 3.4% 33 Primary Metal Products 12,560 3.6%

32 Clay, Concrete, Glass or Stone 7,378 3.3% 24 Lumber or Wood Products 10,655 3.1%

All Others 26,981 12.0% All Others 54,271 15.7%

Total 225,350 Total 346,509

Table 4: Top Commodities in Cincinnati Region by Value, 2009, 2040 (Millions)

2009 2040

STCC Commodity Description Value %

Total STCC Commodity Description Value % Total

50 Secondary Traffic $34,216 14.1% 50 Secondary Traffic $87,217 16.6%

37 Transportation Equipment $29,205 12.1% 36 Electrical Equipment $82,664 15.7%

1 Farm Products $22,353 9.2% 37 Transportation Equipment $61,940 11.8%

28 Chemicals or Allied Products $20,985 8.7% 35 Machinery $53,301 10.1%

20 Food or Kindred Products $20,676 8.5% 28 Chemicals or Allied Products $41,771 7.9%

35 Machinery $18,652 7.7% 20 Food or Kindred Products $36,197 6.9%

33 Primary Metal Products $15,153 6.3% 33 Primary Metal Products $23,187 4.4%

36 Electrical Equipment $14,322 5.9% 1 Farm Products $20,617 3.9%

34 Fabricated Metal Products $8,985 3.7% 30 Rubber or Misc Plastics $15,529 3.0%

30 Rubber or Misc Plastics $7,910 3.3% 34 Fabricated Metal Products $13,830 2.6%

All Others $49,747 20.5% All Others $90,043 17.1%

Total $242,202 Total $526,296

1 Standard Transportation Commodity Code


TRUCK FREIGHT FLOWS

Overview

More than half of truck traffic by volume in the Cincinnati area flows through the region. Inbound and outbound volumes are roughly balanced and expected to grow at similar rates. The value of outbound truck traffic somewhat exceeds that of inbound traffic, but due to higher growth in value of inbound traffic, it will surpass the value of outbound traffic before 2030.

Table 5: Truck Freight Flows by Direction, 2009-2040

Direction 2009 2015 2020 2030 2040

2009-2040

CAGR

Tons (Thousands)

Inbound 37,045 43,333 46,966 54,406 63,535 1.8%

Intra 13,454 14,790 15,939 18,963 22,713 1.7%

Outbound 35,665 42,496 46,176 54,197 64,196 1.9%

Through 99,647 112,146 117,954 131,215 151,649 1.4%

Total 185,811 212,766 227,035 258,781 302,093 1.6%

Value (Millions)

Inbound $38,974 $49,686 $56,654 $74,766 $98,377 3.0%

Intra $4,208 $3,294 $3,763 $4,958 $6,707 1.5%

Outbound $41,898 $51,407 $57,248 $72,799 $93,190 2.6%

Through $132,469 $167,603 $183,470 $227,454 $293,678 2.6%

Total $217,549 $271,989 $301,135 $379,976 $491,951 2.7%


Figure 6 presents the density of Cincinnati’s truck flows routed outbound over the U.S. highway network (inbound, outbound and through). As expected, most of the truck traffic is concentrated with the region and with neighboring states. Other prominent lanes include the Pacific Northwest, Southern states particularly Texas, Virginia and North Carolina.

Figure 6: Routed Total Outbound and Inbound Truck Tons, 2009

Since motor carriers are the predominant mode of transport in the Cincinnati area, commodities moved by truck closely resemble the overall commodity mix in the region. Secondary traffic comprises about 15 percent of total truck moves by volume and will become the largest truck commodity by the end of the forecast period, as no other mode can transport warehouse and retail traffic. The share of farm products moved by truck will decline, although not as drastically as its absolute volume. As mentioned earlier, this decline is predicted because of forecast increases in trucking costs. Farm products have a very low profit margin per ton, so commodity flows are sensitive to increases in transportation costs. There is predicted to be a shift of some of this commodity flow to (lower cost) rail transportation. There are also trends in agriculture production to more centralized, “mega farms,” which reduces product handling in the supply chain, and hence trucking volume.

Equipment and machinery will be some of the fastest growing top commodities in value, due to the Cincinnati region’s strength in this market sector.


Some of the fastest growing truck commodities however do not show up in the top list but will double or triple their volume to a significant percentage of total commodities over the forecast period. These commodities include furniture and fixtures, photographic and optical equipment, inbound seafood products and miscellaneous freight shipments. However, none of these products will comprise more than 2 million tons by 2040.

Table 6: Top Truck Commodities in Cincinnati Region by Volume, 2009, 2040 (Thousands)

2009 2040

STCC Commodity Description Tons %

Total STCC Commodity Description Tons %

Total



14 Nonmetallic Minerals 24,011 12.9% 1 Farm Products 41,025 13.6%


28 Chemicals or Allied Products 11,616 6.3% 28 Chemicals or Allied Products 16,513 5.5%


24 Lumber or Wood Products 7,509 4.0% 32 Clay, Concrete, Glass, Stone 11,736 3.9%

32 Clay, Concrete, Glass, Stone 6,339 3.4% 24 Lumber or Wood Products 10,119 3.3%

11 Coal 4,702 2.5% 33 Primary Metal Products 6,280 2.1%

26 Pulp, Paper or Allied Products 3,712 2.0% 26 Pulp, Paper or Allied Products 6,249 2.1%


Total 185,811 Total 302,093

Table 7: Top Truck Commodities in Cincinnati Region by Value, 2009, 2040 (Millions)

2009 2040


Total STCC Commodity Description Value %

Total


37 Transportation Equipment $27,588 12.7% 36 Electrical Equipment $82,118 16.7%

1 Farm Products $21,986 10.1% 37 Transportation Equipment $58,549 11.9%

20 Food or Kindred Products $19,465 8.9% 35 Machinery $52,654 10.7%

35 Machinery $18,360 8.4% 28 Chemicals or Allied Products $36,926 7.5%

28 Chemicals or Allied Products $17,310 8.0% 20 Food or Kindred Products $34,137 6.9%

36 Electrical Equipment $14,184 6.5% 1 Farm Products $19,955 4.1%

34 Fabricated Metal Products $8,908 4.1% 33 Primary Metal Products $16,315 3.3%

33 Primary Metal Products $8,310 3.8% 30 Rubber or Misc Plastics $15,111 3.1%



Total $217,550 Total $491,952


Inbound

Inbound truck flows account for 20 percent of total truck flows and are expected to grow by an average annual rate of 1.8 percent between 2009 and 2040. As the maps below demonstrate, the majority of inbound truck flows arrive from neighboring states, although some arrive from major gateways such as the ports in California, New York and Louisiana as well the Mexican border crossing in Texas.

Figure 7: Origins of Inbound Truck Freight, 2009

Figure 8: Routed Inbound Truck Tons, 2009


Table 8 shows inbound truck traffic by county. As expected, Hamilton County received the largest amount of inbound truck freight, because Hamilton County has the greatest concentration of population and businesses in the region. Boone County is expected to have the highest growth rate in volume over the forecast period. This county is a big importer of non-metallic minerals and secondary traffic, both fast growing commodities. The value of inbound commodities is expected to grow at a rate of around 3 percent across all the counties in the study region.

Table 8: Inbound Truck Freight Flows by County, 2009-2040

Destination County 2009 2015 2020 2030 2040

2009-2040

CAGR

Tons (Thousands)

Boone, KY 2,921 3,703 4,358 5,906 7,545 3.1%

Butler, OH 8,987 10,504 11,212 12,879 14,977 1.7%

Campbell, KY 1,383 1,764 1,970 2,394 2,797 2.3%

Clermont, OH 2,927 3,165 3,381 3,739 4,221 1.2%

Dearborn, IN 806 934 1,066 1,423 1,815 2.7%

Hamilton, OH 15,021 17,290 18,569 20,761 23,638 1.5%

Kenton, KY 1,872 2,070 2,225 2,571 3,094 1.6%

Warren, OH 3,128 3,902 4,186 4,734 5,447 1.8%

Total 37,045 43,333 46,966 54,406 63,535 1.8%

Value (Millions)

Boone, KY $3,538 $4,278 $5,017 $6,887 $9,074 3.1%

Butler, OH $8,199 $10,598 $12,093 $15,573 $19,885 2.9%

Campbell, KY $1,223 $1,455 $1,655 $2,158 $2,842 2.8%

Clermont, OH $2,202 $2,880 $3,282 $4,311 $5,693 3.1%

Dearborn, IN $535 $616 $707 $992 $1,362 3.1%

Hamilton, OH $17,905 $23,128 $26,223 $34,618 $45,885 3.1%

Kenton, KY $2,049 $2,492 $2,868 $3,879 $5,346 3.1%

Warren, OH $3,321 $4,240 $4,809 $6,349 $8,291 3.0%

Total $38,974 $49,686 $56,654 $74,766 $98,377 3.0%


Table 9: Origins of Inbound Truck Freight, 2009-2040

Origin Region 2009 2015 2020 2030 2040 2009-2040

CAGR

Tons (Thousands)

Ohio 12,548 14,500 15,788 18,295 21,180 1.7%

Kentucky 7,388 8,465 9,019 10,186 11,696 1.5%

Indiana 6,862 7,634 8,121 9,229 10,571 1.4%

Midwest 2,423 3,020 3,359 4,052 4,862 2.3%

Northeast 2,095 2,658 3,015 3,675 4,506 2.5%

South & West 1,224 1,509 1,581 1,707 1,894 1.4%

Michigan 1,217 1,627 1,779 2,111 2,489 2.3%

Tennessee 1,026 1,188 1,239 1,261 1,277 0.7%

Southeast 1,014 1,233 1,378 1,696 2,096 2.4%

Texas 389 470 510 598 698 1.9%

California 351 389 435 575 805 2.7%

Eastern Canada 310 394 458 628 888 3.5%

Washington 89 97 105 128 166 2.0%

Mexico 89 122 149 226 357 4.6%

Western Canada 21 26 29 39 52 3.0%

Total 37,045 43,333 46,966 54,406 63,535 1.8%

Value (Millions)

Ohio $9,156 $10,862 $12,341 $15,248 $18,486 2.3%

Kentucky $3,403 $3,785 $4,113 $4,793 $5,610 1.6%

Indiana $4,431 $5,414 $5,925 $7,305 $9,005 2.3%

Midwest $4,828 $6,104 $6,724 $8,058 $9,716 2.3%

Northeast $5,925 $8,139 $10,125 $15,653 $23,241 4.5%

South & West $894 $1,230 $1,496 $2,322 $3,275 4.3%

Michigan $3,534 $5,460 $5,698 $6,750 $8,014 2.7%

Tennessee $1,492 $1,769 $1,829 $1,892 $1,989 0.9%

Southeast $2,727 $3,360 $3,843 $5,166 $6,880 3.0%

Texas $335 $455 $581 $929 $1,290 4.4%

California $793 $1,148 $1,600 $3,057 $5,235 6.3%

Eastern Canada $610 $796 $941 $1,333 $1,949 3.8%

Washington $174 $231 $283 $442 $710 4.6%

Mexico $640 $892 $1,106 $1,750 $2,880 5.0%

Western Canada $33 $42 $49 $68 $96 3.5%

Total $38,974 $49,686 $56,654 $74,766 $98,377 3.0%

As can be gleaned from the map and seen in greater detail in Table 9, the largest source of truck tons is the rest of the state of Ohio, which contributes more than a third of total inbound truck tonnage. This inbound tonnage from the rest of Ohio consists largely of secondary traffic (32 percent) and short haul moves of sand, gravel and other heavy non-metallic minerals (28 percent). The largest growth in the value of inbound truck commodities however will be from the Northeast, driven by high-value imports. Inbound truck traffic from the


Northeast will comprise about 24 percent of total inbound truck value by 2040, up from a current share of 15 percent. Much of that growth is due to increasing volumes of electronic goods imported through Northeast ports. The value of goods arriving from California and Mexico is also expected to grow at a faster than average rate, albeit from low levels. Nonmetallic minerals and secondary traffic are the dominant inbound truck commodities coming into the region. The high growth in inbound secondary traffic is due to expectations of faster growing wholesale and retail activity in the Cincinnati region.

Table 10: Top Inbound Truck Commodities by Volume, 2009, 2040 (Thousands)

2009 2040

STCC Commodity Description Tons % Total STCC Commodity Description Tons % Total

14 Nonmetallic Minerals 8,312 22.4% 50 Secondary Traffic 22,337 35.2%


1 Farm Products 4,776 12.9% 20 Food or Kindred Products 5,982 9.4%

20 Food or Kindred Products 3,629 9.8% 1 Farm Products 4,590 7.2%

32 Clay, Concrete, Glass, Stone 1,862 5.0% 32 Clay, Concrete, Glass, Stone 2,830 4.5%

28 Chemicals or Allied Products 1,828 4.9% 29 Petroleum or Coal Products 1,845 2.9%

24 Lumber or Wood Products 1,484 4.0% 24 Lumber or Wood Products 1,714 2.7%

11 Coal 1,433 3.9% 28 Chemicals or Allied Products 1,504 2.4%

29 Petroleum or Coal Products 1,370 3.7% 11 Coal 1,395 2.2%

33 Primary Metal Products 845 2.3% 33 Primary Metal Products 1,353 2.1%


Total 37,045 Total 63,535

Electrical equipment will comprise a growing share of the value of inbound truck freight. Although electrical equipment is not one of the top inbound commodities by volume, the tonnage of this high-value commodity is expected to increase from about 230,000 to 1.1 million tons by 2040. Other fast growing, low-volume but high-value commodities will be photo and optical instruments, machinery and miscellaneous manufactured products.

Table 11: Top Inbound Truck Commodities by Value, 2009, 2040 (Millions)

2009 2040

STCC Commodity Description Value % Total STCC Commodity Description Value % Total


20 Food or Kindred Products $4,024 10.3% 36 Electrical Equipment $20,878 21.2%

37 Transportation Equipment $3,366 8.6% 37 Transportation Equipment $9,834 10.0%


36 Electrical Equipment $2,277 5.8% 35 Machinery $6,356 6.5%

1 Farm Products $1,913 4.9% 28 Chemicals or Allied Products $5,028 5.1%

35 Machinery $1,900 4.9% 33 Primary Metal Products $3,131 3.2%

34 Fabricated Metal Products $1,852 4.8% 38 Instrum, Photo & Optical Eq $2,667 2.7%

33 Primary Metal Products $1,780 4.6% 30 Rubber or Misc Plastics $2,343 2.4%



Total $38,974 Total $98,377


Outbound

Outbound truck traffic, which comprises about 20 percent of total truck traffic, is distributed throughout the United States similarly to inbound traffic although it reaches a larger number of counties. The vast majority of it remains within the region or in neighboring states, although some trickles out to ports and border crossings for export. More traffic travels to the western half of the country than arrives from it.

Figure 9: Destination of Outbound Truck Freight, 2009


Figure 10: Routed Outbound Truck Tons, 2009

Hamilton County is the largest source of outbound truck traffic by both volume and value and will remain so during the forecast period, comprising about 45 percent of outbound truck volume and about half of outbound truck value. Warren County will grow the fastest in outbound truck value as a high percentage of its outbound truck volume is comprised of non-metallic minerals and paper and allied products. Both of these commodities will have healthy growth rates in value and volume over the forecast period.


Table 12: Outbound Truck Freight Flows by County, 2009-2040

Origin County 2009 2015 2020 2030 2040

2009-2040

CAGR

Tons (Thousands)

Boone, KY 3,389 4,037 4,459 5,307 6,268 2.0%

Butler, OH 6,590 7,996 8,745 10,473 12,838 2.2%

Campbell, KY 971 1,176 1,287 1,469 1,691 1.8%

Clermont, OH 1,080 1,267 1,377 1,657 2,032 2.1%

Dearborn, IN 889 1,051 1,148 1,357 1,600 1.9%

Hamilton, OH 15,899 18,923 20,858 24,719 29,471 2.0%

Kenton, KY 3,133 3,761 3,669 3,831 3,987 0.8%

Warren, OH 3,713 4,286 4,632 5,385 6,310 1.7%

Total 35,665 42,496 46,176 54,197 64,196 1.9%

Value (Millions)

Boone, KY $5,409 $5,854 $6,459 $7,854 $9,728 1.9%

Butler, OH $5,652 $7,221 $7,889 $9,291 $11,433 2.3%

Campbell, KY $955 $1,136 $1,235 $1,385 $1,553 1.6%

Clermont, OH $1,561 $1,919 $2,029 $2,326 $2,830 1.9%

Dearborn, IN $794 $930 $1,025 $1,211 $1,445 2.0%

Hamilton, OH $21,954 $27,141 $29,753 $37,033 $47,029 2.5%

Kenton, KY $2,104 $2,456 $2,669 $3,118 $3,716 1.9%

Warren, OH $3,469 $4,750 $6,189 $10,583 $15,456 4.9%

Total $41,898 $51,407 $57,248 $72,799 $93,189 2.6%

The rest of Ohio is the largest destination of Cincinnati’s goods that are moved by truck. The largest share of that outbound movement (26 percent) consists of short haul moves of sand, gravel and other non-metallic aggregates. Roughly 18 percent of outbound traffic by tonnage to the rest of Ohio is secondary traffic moving from the Cincinnati area’s warehouses and distribution centers and another 16 percent consists of petroleum or coal products such as gasoline and asphalt. The state’s share will comprise about one third of volume over the forecast period.

Goods shipped to the Northeast such as electronic equipment, food and kindred products, will increase their share of value from about 16 to 20 percent by 2040. The destinations of Cincinnati’s goods will also grow more diversified over the next few decades, as some of the regions smaller trade partners such as California and Eastern and Western Canada will grow at faster rates than its more established trade partners.


Table 13: Destinations of Outbound Truck Freight, 2009-2040

Destination Region 2009 2015 2020 2030 2040

2009-2040

CAGR

Tons (Thousands)

Ohio 11,509 13,526 14,971 18,043 21,713 2.1%

Kentucky 7,154 8,658 9,157 10,482 11,800 1.6%

Indiana 5,128 5,806 5,943 6,180 6,370 0.7%

Northeast 2,797 3,365 3,725 4,352 5,200 2.0%

Midwest 2,421 2,842 3,091 3,524 3,984 1.6%

Michigan 1,416 1,724 1,833 2,009 2,237 1.5%

Southeast 1,242 1,535 1,728 2,112 2,588 2.4%

Tennessee 1,151 1,468 1,578 1,743 1,949 1.7%

South & West 695 759 819 988 1,205 1.8%

Eastern Canada 692 919 1,115 1,610 2,371 4.1%

Texas 649 790 902 1,273 1,898 3.5%

California 544 754 902 1,301 2,045 4.4%

Western Canada 91 119 146 213 316 4.1%

Washington 91 114 128 168 232 3.1%

Mexico 86 117 139 199 289 4.0%

Total 35,665 42,496 46,176 54,197 64,196 1.9%

Value (Millions)

Ohio $8,325 $9,547 $10,731 $13,118 $15,808 2.1%

Kentucky $3,757 $3,693 $4,079 $4,793 $5,620 1.3%

Indiana $4,292 $4,743 $4,985 $5,456 $5,904 1.0%

Northeast $6,774 $8,800 $10,319 $13,895 $18,527 3.3%

Midwest $4,151 $5,146 $5,667 $7,188 $8,920 2.5%

Michigan $2,852 $3,582 $3,629 $4,000 $4,584 1.5%

Southeast $2,606 $3,375 $3,966 $5,428 $7,296 3.4%

Tennessee $2,868 $3,562 $3,690 $4,090 $4,653 1.6%

South & West $521 $615 $679 $826 $1,029 2.2%

Eastern Canada $1,982 $2,673 $3,306 $4,969 $7,653 4.5%

Texas $1,382 $2,110 $2,322 $3,521 $5,332 4.5%

California $677 $834 $945 $1,206 $1,628 2.9%

Western Canada $223 $295 $363 $536 $809 4.2%

Washington $1,167 $1,979 $2,024 $2,964 $4,210 4.2%

Mexico $323 $450 $542 $806 $1,218 4.4%

Total $41,898 $51,407 $57,248 $72,799 $93,190 2.6%


Cincinnati’s outbound truck commodities are similar to its inbound, with secondary traffic and nonmetallic minerals being the largest by volume. Since the overall forecast is commodity driven, and high value commodities such as transportation and electrical equipment are expected to see some of the highest growth relative to lower value commodities, these commodities comprise a large share of total value by 2040.

Table 14: Top Outbound Truck Commodities by Volume, 2009, 2040 (Thousands)

2009 2040



Total

14 Nonmetallic Minerals 6,143 17.2% 50 Secondary Traffic 15,208 23.7%





11 Coal 1,915 5.4% 32 Clay, Concrete, Glass, Stone 3,177 4.9%

32 Clay, Concrete, Glass, Stone 1,645 4.6% 26 Pulp, Paper or Allied Products 2,551 4.0%

26 Pulp, Paper or Allied Products 1,494 4.2% 40 Waste or Scrap Materials 1,780 2.8%

34 Fabricated Metal Products 874 2.4% 11 Coal 1,676 2.6%

1 Farm Products 850 2.4% 34 Fabricated Metal Products 1,177 1.8%



Table 15: Top Outbound Truck Commodities by Value, 2009, 2040 (Millions)

2009 2040



Total


20 Food or Kindred Products $6,347 15.1% 37 Transportation Equipment $12,445 13.4%

28 Chemicals or Allied Products $5,737 13.7% 36 Electrical Equipment $12,233 13.1%

37 Transportation Equipment $4,646 11.1% 20 Food or Kindred Products $10,622 11.4%

35 Machinery $2,554 6.1% 28 Chemicals or Allied Products $9,212 9.9%

34 Fabricated Metal Products $2,512 6.0% 35 Machinery $6,770 7.3%

26 Pulp, Paper or Allied Products $2,186 5.2% 26 Pulp, Paper or Allied Products $3,702 4.0%

29 Petroleum or Coal Products $1,767 4.2% 34 Fabricated Metal Products $3,399 3.6%

27 Printed Matter $1,451 3.5% 27 Printed Matter $2,300 2.5%

36 Electrical Equipment $1,331 3.2% 41 Misc Freight Shipments $2,230 2.4%


Total $41,898 Total $93,190


Through

The largest component of truck traffic in the Cincinnati region is through traffic, with about 53 percent of the total share. Truck traffic traveling through the Cincinnati region largely flows in the northwest to southeast direction, primarily originating in the Midwest, as demonstrated by both Figure 11 and Tables 16 and 17.

Traffic between the Midwest and Southeast regions accounts for almost one third of current through truck volumes. Nearly 95 percent of the tonnage on that lane consists of farm products, mostly grains and other field crops. The through lanes are expected to become more diversified over the forecast period due to different economic growth rates in the regions, with the top ten lanes comprising less than half of total through truck volumes by 2040. This trend is partially driven by a general shift in farm product towards rail and away from truck.

Through traffic will also come from a wider set of regions as measured in dollars, with more value passing through to more far flung regions such as Eastern Canada. Many local through lanes such as between Ohio and Kentucky and Tennessee will remain prominent in through truck traffic.

Figure 11: Truck Flows Through the Cincinnati Region, 2009


Table 16: Top Ten Through Truck Lanes by Volume, 2009, 2040 (Thousands)

2009 2040

Origin Destination Tons % Total Origin Destination Tons %

Total

Midwest Southeast 31,236 31.3% Midwest Southeast 26,719 17.6%

Kentucky Ohio 4,348 4.4% Kentucky Ohio 7,674 5.1%

South & West Southeast 4,124 4.1% Ohio Kentucky 5,504 3.6%

Midwest Northeast 3,657 3.7% South & West Ohio 5,493 3.6%

Ohio Kentucky 3,575 3.6% Southeast Midwest 5,272 3.5%

South & West Northeast 3,465 3.5% Ohio Southeast 4,384 2.9%

South & West Ohio 3,083 3.1% Northeast Texas 4,214 2.8%

Southeast Midwest 2,682 2.7% South & West Northeast 4,170 2.7%

Northeast Texas 2,096 2.1% South & West Southeast 3,374 2.2%

Indiana Kentucky 1,831 1.8% Southeast Eastern Canada 3,115 2.1%


Total 99,647 Total 151,649

Table 17: Top Ten Through Truck Lanes by Value, 2009, 2040 (Millions)

2009 2040

Origin Destination Value % Total Origin Destination Value %

Total

Midwest Southeast $15,852 12.0% Midwest Southeast $16,489 5.6%

Kentucky Ohio $7,920 6.0% Kentucky Ohio $14,333 4.9%

Ohio Kentucky $5,835 4.4% Tennessee Eastern Canada $13,564 4.6%

Southeast Midwest $5,167 3.9% Southeast Eastern Canada $11,448 3.9%

Southeast Eastern Canada $3,747 2.8% Eastern Canada Southeast $10,446 3.6%

Ohio Tennessee $3,628 2.7% Ohio Kentucky $9,598 3.3%

Tennessee Eastern Canada $3,610 2.7% Mexico Ohio $9,409 3.2%

Ohio Southeast $3,134 2.4% Ohio Southeast $8,450 2.9%

Michigan Kentucky $2,932 2.2% Southeast Indiana $8,358 2.8%

Kentucky Michigan $2,789 2.1% Southeast Midwest $7,322 2.5%


Total $132,469 Total $293,678


Nationwide, commodities such as farm products, secondary traffic, and food or kindred products are some of the top heavy commodities transported by truck, and thusly they account for the largest share of through truck traffic in most regions, including Cincinnati. Higher-value added products such as machinery, equipment and certain chemicals are the leaders in truck traffic when measured by value.

Table 18: Top Through Truck Commodities by Volume, 2009, 2040 (Thousands)

2009 2040



Total


50 Secondary Traffic 13,037 13.1% 1 Farm Products 35,503 23.4%


24 Lumber or Wood Products 5,715 5.7% 28 Chemicals or Allied Products 10,115 6.7%

28 Chemicals or Allied Products 5,450 5.5% 24 Lumber or Wood Products 7,951 5.2%


37 Transportation Equipment 2,365 2.4% 32 Clay, Concrete, Glass, Stone 4,827 3.2%

32 Clay, Concrete, Glass, Stone 2,220 2.2% 37 Transportation Equipment 4,444 2.9%

33 Primary Metal Products 2,040 2.0% 35 Machinery 4,050 2.7%

35 Machinery 1,501 1.5% 33 Primary Metal Products 3,968 2.6%


Total 99,647 Total 151,649

Table 19: Top Through Truck Commodities by Value, 2009, 2040 (Millions)

2009 2040



Total

1 Farm Products $19,766 14.9% 36 Electrical Equipment $49,007 16.7%

37 Transportation Equipment $19,427 14.7% 35 Machinery $39,529 13.5%


35 Machinery $13,906 10.5% 37 Transportation Equipment $35,750 12.2%

36 Electrical Equipment $10,576 8.0% 28 Chemicals or Allied Products $22,669 7.7%

20 Food or Kindred Products $9,032 6.8% 1 Farm Products $17,402 5.9%


33 Primary Metal Products $5,674 4.3% 33 Primary Metal Products $11,700 4.0%

30 Rubber or Misc Plastics $5,206 3.9% 30 Rubber or Misc Plastics $10,866 3.7%

34 Fabricated Metal Products $4,543 3.4% 38 Instrum, Photo & Optical Eq $8,694 3.0%


Total $132,469 Total $293,678


Truck Flows by Highway

This section provides a more detailed look at truck traffic flowing along Cincinnati’s major interstate highways, I-71, I-74 and I-75.

Figure 12: I-71 Truck Flows, 2009


Interstate 71 enters the Cincinnati region at Warren County, Ohio at the border of Montgomery County and leaves the region at the southern border of Boone County, Kentucky. From Cincinnati south to where it splits near Walton, Kentucky, I-71 is co-signed with Interstate 75. Both interstates cross the Ohio River at the Brent Spence Bridge between Cincinnati, Ohio and Covington, Kentucky.

In 2009, nearly 125 million of the 185 million tons of freight that moved in to, out of and through the OKI region by truck traveled on I-71 during part of their movement. Of that, 125 million total over 65 percent, or 81 million tons, consisted of traffic that moves through the region. Roughly 17 percent of the freight traffic by weight originated in the region while a further 15 percent originated elsewhere but terminated in the region. Figure 13 below displays the outlook for tons on I-71.

Figure 13: I-71 Volumes, 2009-2040

Freight traffic that travels along I-71 is expected to grow at an average of 2.1 percent annually to 2040. Of this traffic, intra-region tonnage is expected to grow most quickly, at an average of 2.8 percent per year from roughly 4 million tons in 2009 to 9.4 million in 2040. Inbound and outbound freight tons are expected to each grow 1.9 percent annually. Inbound tonnage using Interstate 71 is anticipated to grow from 21 to 38 million tons with outbound going from 19 million to 33.5 million tons.

Unlike with Interstate 74 traffic described in the following section, no one type of product dominates the traffic on Interstate 71. In 2009, over 16 percent of all tonnage in the Cincinnati region on I-71 was secondary warehouse or distribution center traffic, a total of 19 million tons. Other top commodities by weight were food and kindred products (12.5 million tons), farm products (12.3 million tons), and non-metallic minerals (10 million tons). Of all of the freight traffic on I-71 in 2009, nearly 23 percent originates elsewhere in Ohio or Kentucky and another 8 percent originates in Hamilton County, Ohio alone. On the terminating side, about 25 percent of traffic is destined for the rest of Ohio or Kentucky.

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100

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180

2009 2015 2020 2030 2040

Millions

Inbound

Outbound

Through

Intra


Interstate 74 enters the OKI region at Dearborn County, Indiana and terminates within the region at its intersection with I-75 in Cincinnati. The interstate is co-signed with U.S. Route 52 where they join in Indiana until its eastern terminus in Ohio. In 2009, nearly 80 million of the 185 million tons of freight that moved in to, out of and through the Cincinnati region by truck traveled on a portion of I-74. Of that 80 million total over 80 percent, or 65 million tons, was traffic that moves through the region, rather than traffic that originates or terminates within the region as a result of local economic activity. Figure 15 below shows the dominance of through traffic on this highway as well as the forecast for tons traveling on I-74.


Freight traffic that travels along I-74 is expected to grow at an average annual rate of 0.8 percent to 2040. Of this traffic, intra-region tonnage is expected to grow most quickly, at an average of 2.6 percent annually from roughly 750 thousand tons in 2009 to 1.6 million in 2040. Inbound and outbound freight tons are expected to grow 1.6 percent and 1.7 percent on average per year, respectively. Inbound tonnage using Interstate 74 is anticipated to grow from 6.4 to 10.5 million tons with outbound going from 6.6 million to 11.1 million tons.

According to the TRANSEARCH® database, in 2009 over 50 percent of all tonnage travelling through the Cincinnati region on I-74 carried agricultural products, a total of 42 million tons. Other top commodities by weight were food and kindred products (8.4 million tons), chemicals (2.9 million tons), and petroleum products (2.2 million tons). Of all of the freight traffic on I-74 in 2009, nearly 90 percent originates in the Midwest, while 92 percent terminates in the Southeast region of the U.S.

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50

60

70

80

90

2009 2015 2020 2030 2040

Millions

Inbound

Outbound

Through

Intra



Interstate 75 enters the Cincinnati region at Warren County, Ohio at the border of Clinton County and leaves the region at the southern border of Kenton County, Kentucky. From Cincinnati south to where it splits near Walton, Kentucky, I-75 is co-signed with Interstate 71. Both interstates cross the Ohio River at the Brent Spence Bridge between Cincinnati, Ohio and Covington, Kentucky.


In 2009, nearly 146 million of the 185 million tons of freight that moved into, out of and through the Cincinnati region traveled on I-75 during part of their movement, the most of the three interstates included in the study. Of the 146 million, nearly 60 percent, or 86 million tons, consisted of through traffic. Roughly 19 percent of the freight traffic by weight originated in the region while 17 percent terminated in the region. Figure 17 below presents the outlook for tons on I-75.


Freight traffic that travels along I-75 is expected to grow at an average rate of 2.0 percent per year over the forecast period. Of this traffic, intra-region tonnage is expected to grow most quickly, at an average of 2.1 percent annually from roughly 6.8 million tons in 2009 to 13 million in 2040. Inbound and outbound freight tons are expected to each grow annually at 1.9 percent and 1.7 percent, respectively. Inbound tonnage using I-75 is anticipated to grow from 27 to 50 million tons with outbound going from 25 million to 43 million tons.

As for I-71, no one type of product dominates the traffic on I-75. Over 14 percent of all tonnage in the region on I-75 was secondary warehouse or distribution center traffic, a total of 21 million tons in 2009. Other top commodities by weight were non-metallic minerals (15 million tons), food and kindred products (14 million tons), and farm products (14 million tons). Of all of the freight traffic on I-75 in 2009, roughly 12 percent originates in Hamilton County, Ohio alone while another 20 percent originates outside of the region in Ohio or Kentucky. Inbound traffic to the region follows a similar pattern.

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Outbound

Through

Intra


RAIL FREIGHT FLOWS

Overview

In the Cincinnati area, rail accounts for about 8 percent of total freight flows by volume and about 7 percent by value. The region’s rail traffic primarily consists of carloads of bulk commodities such as coal and metals. In 2009, about 9 percent of the region’s rail volume was comprised of intermodal movements. However, since intermodal commodities are of much higher value per ton than bulk commodities, intermodal rail traffic accounted for 34 percent of rail commodity value. Since growth prospects for intermodal rail are very positive, it is expected to account for 12 percent of volume and a full 40 percent of value by the end of the forecast period. Total volume will thus still be dominated by carload and other bulk traffic but to a lesser extent. (Note that carload and intermodal composition of rail traffic originating or terminating in Mexico or Canada is not available in the TRANSEARCH® database. However, since NAFTA traffic comprises a low proportion of rail traffic by value, one can assume that the majority of this freight travels by carload1.)

Figure 18: Rail Traffic by Type, 2009 (Tons, Value)

1 Carload refers to rail traffic which is not carried in containers. Examples include coal hoppers, boxcars, and auto racks.

85%

9%

6%

Carload Intermodal NAFTA

55%34%

11%



Table 20 shows rail flows in, out and within the Cincinnati BEA. More than twice as much rail traffic by volume enters the region than flows out of it. However, since outbound rail traffic is expected to grow at a faster rate than inbound rail traffic, rail flows will become more balanced by the end of the forecast period. Outbound rail flows also exceed inbound rail flows by value, indicating that higher-value goods are exported out of the region by rail than are imported into the region. As expected, intra-regional flows are insignificant, since the rail mode is most often used for shipments covering longer distances.

Table 20: Rail Traffic by Direction, 2009-2040

Direction 2009 2015 2020 2030 2040

2009-2040

CAGR

Tons (Thousands)

Inbound 12,382 13,846 13,750 13,540 14,124 0.4%

Intra 98 137 141 143 147 1.3%

Outbound 5,298 6,567 6,822 6,830 7,037 0.9%

Total 17,778 20,550 20,712 20,513 21,309 0.6%

Value (Millions)

Inbound $8,688 $9,097 $9,537 $10,265 $11,963 1.0%

Intra $42 $52 $55 $55 $54 0.8%

Outbound $9,146 $10,378 $10,984 $11,662 $12,780 1.1%

Total $17,876 $19,527 $20,577 $21,981 $24,797 1.1%

Inbound

Inbound rail traffic is even more heavily skewed towards carloads than the overall rail profile in the Cincinnati area. Intermodal rail traffic comprises 5 percent of inbound rail volume and 34 percent of inbound rail value. Over the forecast period, intermodal volume is expected to increase by an average annual growth rate of 2.2 percent compare to an average annual growth rate of just 0.1 percent for inbound carload traffic. Due to this difference in relative growth rates, intermodal is expected to comprise 9 percent of total inbound volume and 47 percent of inbound value by the end of the forecast period. Rail trade with NAFTA countries will grow by even faster average annual growth rate of 2.4 percent by volume. This is due to the slight improvement to Mexico’s economic output over the forecast period, and the distance to Mexican markets, which is favorable to rail.


Figure 19: Inbound Rail Traffic by Type, 2009 (Tons, Value)

Figure 20 demonstrates the origins of rail traffic entering the Cincinnati BEA. The majority of rail traffic arrives from within the Midwest region. Gateway areas including BEA’s encompassing ports in Los Angeles/Long Beach, New York, New Orleans, and Houston as well as BEA’s near the Canadian border crossings are also large contributors of inbound rail traffic.

Figure 20: Origins of Inbound Rail Flows, 2009

88%

5%

7%


62%

32%

6%



Table 21: Origins of Inbound Rail Traffic, 2009-2040

Origin Region 2009 2015 2020 2030 2040 2009-2040

CAGR

Tons (Thousands)

Kentucky 3,903 3,715 3,445 2,937 2,653 ‐1.2%

Northeast 2,265 2,109 2,010 1,875 1,915 ‐0.5%

Ohio 2,045 3,165 3,124 3,037 3,057 1.3%

Midwest 803 949 1,006 1,097 1,207 1.3%

Southeast 657 724 785 892 1,076 1.6%

Indiana 511 605 616 591 583 0.4%

Eastern Canada 471 583 644 793 987 2.4%

South & West 393 443 443 408 370 ‐0.2%

Western Canada 327 393 434 532 664 2.3%

California 307 344 389 484 635 2.4%

Michigan 248 314 321 326 340 1.0%

Texas 215 228 227 197 159 ‐1.0%

Washington 128 143 166 221 312 2.9%

Tennessee 91 108 113 116 122 0.9%

Mexico 18 24 26 34 46 3.0%

Total 12,382 13,846 13,750 13,540 14,124 0.4%

Value (Millions)

Kentucky $2,034 $2,126 $2,011 $1,649 $1,401 ‐1.2%

Northeast $1,736 $1,519 $1,571 $1,673 $1,982 0.4%

Ohio $245 $336 $336 $337 $347 1.1%

Midwest $568 $625 $658 $701 $751 0.9%

Southeast $951 $915 $1,013 $1,226 $1,616 1.7%

Indiana $352 $415 $411 $359 $320 ‐0.3%

Eastern Canada $300 $372 $419 $536 $700 2.8%

South & West $327 $355 $352 $302 $229 ‐1.1%

Western Canada $181 $220 $248 $320 $421 2.8%

California $987 $1,104 $1,297 $1,734 $2,417 2.9%

Michigan $92 $114 $115 $110 $109 0.6%

Texas $338 $350 $354 $308 $241 ‐1.1%

Washington $523 $581 $683 $924 $1,321 3.0%

Tennessee $32 $38 $39 $37 $34 0.2%

Mexico $21 $28 $32 $47 $74 4.1%

Total $8,688 $9,097 $9,537 $10,264 $11,963 1.0%

Table 21 presents the forecast of inbound traffic by origin region. Kentucky and the Northeast provide the most rail traffic by both volume and value, with Kentucky accounting for about a third of current volumes. Almost all of the inbound Kentucky traffic in 2009 was either coal (54 percent by tonnage) or primary metal products (43 percent). The profile of inbound freight from the Northeast was similar, with coal comprising 43 percent of the tonnage and primary metal products comprising 23 percent. Eighty percent of the inbound traffic originating elsewhere in Ohio consisted of metallic ores from the state’s Great Lakes ports of Toledo


and Cleveland. The fastest growing regions are Western import gateways including California and Washington. At the end of the forecast period, California will become the largest source of inbound rail shipments by value, reflecting the growing importance of intermodal transport in moving high-value goods. Total volumes will however remain small, as carload traffic will still be the primary source of volume on the nation’s and on Cincinnati’s railways.

The top inbound rail commodities also reflect the interplay between intermodal and carload traffic. Heavy bulk commodities such as coal and metallic ores comprise the majority of inbound rail volumes. Primary metal products also contribute the majority of inbound rail value, but commodities such as miscellaneous mixed shipments are also prominent. Inbound coal shipments will shrink by an average annual rate of about 1.5 percent, primarily due to shifting regional patterns in coal production. Metallic ores will become the largest inbound rail commodity, growing by an average annual rate of about 1.3 percent.

Table 22: Top Inbound Rail Commodities by Volume, 2009, 2040 (Thousands)

2009 2040


11 Coal 3,097 25.0% 10 Metallic Ores 2,667 18.9%

33 Primary Metal Products 2,717 21.9% 33 Primary Metal Products 2,104 14.9%

10 Metallic Ores 1,760 14.2% 11 Coal 1,945 13.8%


28 Chemicals or Allied Products 957 7.7% 46 Misc Mixed Shipments 1,104 7.8%

46 Misc Mixed Shipments 564 4.6% 28 Chemicals or Allied Products 844 6.0%

29 Petroleum or Coal Products 561 4.5% 40 Waste or Scrap Materials 801 5.7%

40 Waste or Scrap Materials 477 3.9% 29 Petroleum or Coal Products 692 4.9%

26 Pulp, Paper or Allied Products 387 3.1% 26 Pulp, Paper or Allied Products 559 4.0%

32 Clay, Concrete, Glass & Stone 326 2.6% 32 Clay, Concrete, Glass & Stone 538 3.8%

All Others 478 3.9% All Others 1,007 7.1%


Table 23: Top Inbound Rail Commodities by Value, 2009, 2040 (Millions)

2009 2040


33 Primary Metal Products $2,906 33.1% 46 Misc Mixed Shipments $4,896 40.4%

46 Misc Mixed Shipments $2,502 28.5% 33 Primary Metal Products $2,105 17.4%


20 Food or Kindred Products $784 8.9% 28 Chemicals or Allied Products $1,052 8.7%

26 Pulp, Paper or Allied Products $377 4.3% 37 Transportation Equipment $551 4.5%

29 Petroleum or Coal Products $235 2.7% 26 Pulp, Paper or Allied Products $505 4.2%

37 Transportation Equipment $144 1.6% 29 Petroleum or Coal Products $288 2.4%

10 Metallic Ores $123 1.4% 30 Rubber or Misc Plastics $248 2.0%

11 Coal $104 1.2% 10 Metallic Ores $187 1.5%

40 Waste or Scrap Materials $80 0.9% 24 Lumber or Wood Products $163 1.3%

All Others $379 4.3% All Others $738 6.1%

Total $8,768 Total $12,127


Outbound

Outbound rail shipments contain a larger proportion of intermodal freight than inbound rail shipments in the Cincinnati BEA. In 2009, intermodal freight consisted of 16 percent of total inbound rail volume and 35 percent of total inbound value. Intermodal freight volume is expected to expand by an average annual growth rate of 1.7 percent over the forecast period. By 2040, intermodal is thus expected to account for 17 percent of total inbound volume and 34 percent of total inbound value. Carload traffic will grow by an average annual rate of only 0.5 percent. However, NAFTA traffic, which is predicted to expand by 3.2 percent per year on average, will comprise 12 percent of volume and 24 percent of value by 2040.

Figure 21: Outbound Rail Traffic by Type, 2009 (Tons, Value)

Outbound rail shipments display a similar pattern to inbound shipments, with a little more concentration in the Northeast and Southeast. Outbound shipments primarily travel within the Midwest or for export to ports and border crossings in California, New York, Texas, Louisiana and Michigan.

78%

16%

6%


49%

35%

16%



Figure 22: Destinations of Outbound Rail Flows, 2009

Indiana is the largest current recipient of the Cincinnati BEA’s rail goods, but it will be surpassed by Michigan prior to 2020. Indiana’s share of outbound volumes will fall from about 25 to 18 percent. Almost 95 percent of the rail tonnage to Indiana consists of primary metal products, most of which terminate in the Evansville, Indiana BEA, where Koch Enterprises (automotive and industrial parts manufacturing) and Toyota (SUVs and vans) both have major manufacturing facilities. The Southeast receives the largest amount of outbound rail commodities by value, most of which are mixed intermodal shipments, but will be slightly surpassed by Eastern Canada at the end of the forecast period. Western Canada is one of the fastest growing destinations for outbound rail goods, but is growing from a low base.


Table 24: Destinations of Outbound Rail Traffic, 2009-2040


2009-2040

CAGR

Tons (Thousands)

Indiana 1,647 2,282 2,237 1,931 1,626 0.0%

Southeast 840 806 864 946 1,045 0.7%

Northeast 731 808 869 951 1,096 1.3%

Ohio 358 467 509 544 571 1.5%

Kentucky 310 406 404 374 357 0.5%

Michigan 301 389 378 298 236 ‐0.8%

Eastern Canada 257 351 393 496 655 3.1%

Midwest 239 293 308 298 284 0.6%

California 178 216 251 318 409 2.7%

South & West 131 157 168 165 153 0.5%

Tennessee 123 155 166 162 152 0.7%

Texas 81 103 116 133 158 2.2%

Western Canada 50 71 83 114 160 3.8%

Washington 31 33 38 51 66 2.5%

Mexico 23 32 37 49 67 3.6%

Total 5,298 6,567 6,822 6,830 7,037 0.9%

Value (Millions)

Indiana $1,822 $2,518 $2,466 $2,121 $1,775 ‐0.1%

Southeast $1,879 $1,482 $1,600 $1,830 $2,160 0.5%

Northeast $1,281 $1,081 $1,187 $1,385 $1,717 0.9%

Ohio $446 $589 $673 $784 $856 2.1%

Kentucky $296 $434 $427 $405 $394 0.9%

Michigan $311 $402 $391 $308 $246 ‐0.8%

Eastern Canada $1,341 $1,849 $1,976 $2,244 $2,623 2.2%

Midwest $356 $361 $384 $388 $392 0.3%

California $596 $685 $796 $1,019 $1,295 2.5%

South & West $226 $253 $275 $272 $251 0.3%

Tennessee $117 $149 $157 $147 $129 0.3%

Texas $233 $281 $299 $265 $243 0.1%

Western Canada $73 $100 $125 $191 $304 4.7%

Washington $116 $123 $144 $186 $236 2.3%

Mexico $51 $74 $85 $116 $160 3.7%

Total $9,146 $10,378 $10,984 $11,662 $12,780 1.1%

The outbound commodity mix is similar to the mix of inbound goods. Primary metal products are the largest inbound commodity, although its share of total volume will decline due its flat growth rate. Mixed shipments, primarily intermodal ones, comprise the largest share of value. Chemicals will be one of the


fastest growing outbound commodities, growing at an average annual rate of about 1.5 percent, although some low volume commodities such as electrical equipment will grow at faster rates and travel by intermodal rail.

Table 25: Top Outbound Rail Commodities by Volume, 2009, 2040

(Thousands)

2009 2040

STCC Commodity Description

Tons %

Total STCC Commodity Description

Tons %

Total

33 Primary Metal Products 2,380 44.9% 33 Primary Metal Products 2,340 33.3%

28 Chemicals or Allied Products 664 12.5% 28 Chemicals or Allied Products 1,007 14.3%

46 Misc Mixed Shipments 641 12.1% 40 Waste or Scrap Materials 877 12.5%

40 Waste or Scrap Materials 371 7.0% 46 Misc Mixed Shipments 776 11.0%

20 Food or Kindred Products 327 6.2% 20 Food or Kindred Products 522 7.4%

26 Pulp, Paper or Allied Products 204 3.8% 26 Pulp, Paper or Allied Products 392 5.6%

1 Farm Products 193 3.6% 37 Transportation Equipment 355 5.0%

37 Transportation Equipment 183 3.5% 32 Clay, Concrete, Glass or Stone 236 3.4%

32 Clay, Concrete, Glass or Stone 122 2.3% 1 Farm Products 204 2.9%

29 Petroleum or Coal Products 70 1.3% 29 Petroleum or Coal Products 91 1.3%

All Others 143 2.7% All Others 238 3.4%


Table 26: Top Outbound Rail Commodities by Value, 2009, 2040 (Millions)

2009 2040



Total

46 Misc Mixed Shipments $2,841 30.9% 46 Misc Mixed Shipments $3,441 26.7%

33 Primary Metal Products $2,672 29.0% 37 Transportation Equipment $2,697 20.9%

37 Transportation Equipment $1,415 15.4% 33 Primary Metal Products $2,632 20.4%

28 Chemicals or Allied Products $1,089 11.8% 28 Chemicals or Allied Products $2,187 17.0%

20 Food or Kindred Products $376 4.1% 20 Food or Kindred Products $586 4.5%

19 Ordnance or Accessories $167 1.8% 26 Pulp, Paper or Allied Products $263 2.0%

26 Pulp, Paper or Allied Products $133 1.4% 36 Electrical Equipment $231 1.8%

30 Rubber or Misc Plastics $95 1.0% 30 Rubber or Misc Plastics $168 1.3%

36 Electrical Equipment $63 0.7% 40 Waste or Scrap Materials $154 1.2%

40 Waste or Scrap Materials $62 0.7% 35 Machinery $112 0.9%


Total $9,208 Total $12,892


AIR CARGO

Overview

This section provides an overview and forecast of air cargo freight in the Cincinnati region. The source of air cargo forecast is IHS Global Insight’s TRANSEARCH® database, which does not capture or model international cargo, nor domestic cargo that is hubbed through an area but does not originate or terminate there.

Cincinnati /Northern Kentucky International airport is the primary air cargo airport in the Cincinnati study area. According to the Federal Aviation Administration’s T-100 data, only three round-trip flights to Europe, accounting for less than 10 percent of total air cargo tonnage, contained air cargo in 2009 (again, these data exclude the DHL hub operation). The Municipal Airport at Lunken Field also processes a small amount of domestic air cargo and does not have any international air cargo shipments.

Table 27: Air Cargo in the Cincinnati Region, 2009-2040

Airport 2009 2015 2020 2030 2040

2009-2040

CAGR

Inbound Tons

Cincinnati Muni Airport Lunken Field 25 35 45 72 120 5.2%

Cincinnati/Northern Kentucky International 57,404 75,170 82,248 93,970 102,804 1.9%

Total Inbound 57,429 75,205 82,292 94,042 102,924 1.9%

Inbound Value (Millions)

Cincinnati Muni Airport Lunken Field $5 $7 $9 $16 $31 6.4%

Cincinnati/Northern Kentucky International $366 $560 $643 $804 $894 2.9%

Total Inbound $371 $567 $652 $820 $926 3.0%

Outbound Tons

Cincinnati Muni Airport Lunken Field 491 659 799 1,187 1,799 4.3%


Total Inbound 54,948 71,368 86,998 119,909 156,019 3.4%

Outbound Value (Millions)


Cincinnati/Northern Kentucky International $245 $318 $388 $535 $694 3.4%

Total Inbound $289 $380 $466 $662 $905 3.8%

Total Tons

Cincinnati Muni Airport Lunken Field 516 695 844 1,258 1,919 4.3%


Total Tons 112,377 146,573 169,290 213,951 258,943 2.7%

Total Value (Millions)


Cincinnati/Northern Kentucky International $611 $878 $1,031 $1,338 $1,589 3.1%

Total Value $660 $946 $1,118 $1,482 $1,831 3.3%


Air cargo will be the fastest growing mode in the Cincinnati area. However, despite average annual growth rates of 2.7 percent by volume and 3.3 percent by value, air cargo will still comprise less than one percent of total freight tonnage and value in the region, as Cincinnati is not home to a major air cargo airport. Inbound and outbound cargo flows are fairly balanced at Cincinnati International, but Lunken Field ships out more tonnage than it receives.

Figure 23 below demonstrates, the majority of air cargo flies between the Cincinnati area and regions containing major air cargo airports such as New York, Miami, Los Angeles, Chicago, Memphis and other major cargo airports in the United States.

Figure 23: Air Cargo Origins and Destinations, 2009


Inbound

As displayed in Table 28, the South and West region is the largest source of Cincinnati’s regional inbound air cargo from North America, accounting for 42 percent of inbound air tonnage. About 30 percent of the tonnage from the South and West is for machinery. Food and kindred products and fresh fish and marine products each account for another one fourth of the tonnage.

Table 28: Air Cargo by Origin, 2009-2040

Origin Region 2009 2015 2020 2030 2040 2009-2040

CAGR

Tons

South & West 23,959 30,063 30,680 29,561 25,629 0.2%

Northeast 7,645 9,564 10,423 11,590 12,323 1.6%

California 5,859 7,438 8,420 10,601 12,776 2.5%

Tennessee 5,459 8,050 9,479 12,321 15,061 3.3%

Midwest 4,309 6,285 7,090 8,560 10,033 2.8%

Southeast 4,135 5,483 6,626 9,297 12,337 3.6%

Texas 3,341 4,514 5,245 6,749 8,485 3.1%

Ohio 1,533 2,216 2,505 3,094 3,615 2.8%

Washington 1,152 1,542 1,761 2,170 2,512 2.5%

Mexico 19 27 34 56 96 5.4%

Kentucky 7 9 11 15 21 3.8%

Indiana 5 8 9 11 14 3.2%

Western Canada 3 4 5 7 10 3.5%

Eastern Canada 2 3 4 6 11 5.9%

Michigan 1 1 1 1 1 3.3%

Total 57,429 75,205 82,292 94,042 102,924 1.9%

Value (Thousands)

South & West $91,112 $139,478 $147,992 $145,024 $120,212 0.9%

Northeast $33,575 $48,376 $55,612 $70,202 $83,023 3.0%

California $45,886 $74,652 $93,961 $129,230 $141,596 3.7%

Tennessee $61,343 $89,469 $111,272 $153,420 $184,197 3.6%

Midwest $30,213 $46,826 $54,609 $71,034 $86,610 3.5%

Southeast $50,168 $78,833 $82,860 $108,986 $130,800 3.1%

Texas $23,647 $35,686 $43,048 $56,717 $68,917 3.5%

Ohio $11,974 $18,381 $21,211 $26,620 $29,323 2.9%

Washington $17,964 $28,136 $31,930 $42,197 $49,655 3.3%

Mexico $4,162 $6,037 $8,141 $15,164 $29,020 6.5%

Kentucky $29 $38 $47 $68 $93 3.8%

Indiana $29 $48 $51 $61 $71 2.9%

Western Canada $184 $240 $284 $397 $564 3.7%

Eastern Canada $261 $389 $514 $899 $1,596 6.0%

Michigan $3 $4 $5 $6 $7 3.2%

Total $370,551 $566,594 $651,536 $820,026 $925,686 3.0%


However, by the end of the forecast period, California, Tennessee and the Southeast are expected to supply more valuable air cargo to the region due to growth rates of more than 3 percent in value compared to less than one percent for the South and West. Some of the major fast growing commodities in value from these areas will be miscellaneous manufactured products and electrical equipment from California, high-value chemicals including pharmaceuticals from Tennessee and transportation equipment and miscellaneous mixed shipments from the Southeast. Once again, note that DHL’s hub operation is not included in the inbound data and forecast due to a lack of information on international air cargo.

Table 29: Top Inbound Air Commodities by Volume, 2009, 2040 (Thousands)

2009 2040


35 Machinery 13,717 23.9% 46 Misc Mixed Shipments 20,002 19.4%

28 Chemicals or Allied Products 9,689 16.9% 35 Machinery 18,636 18.1%

20 Food or Kindred Products 6,543 11.4% 28 Chemicals or Allied Products 15,287 14.9%

9 Fresh Fish or Marine Products 6,373 11.1% 36 Electrical Equipment 10,892 10.6%

46 Misc Mixed Shipments 6,233 10.9% 39 Misc Manufacturing Products 10,206 9.9%

36 Electrical Equipment 3,758 6.5% 20 Food or Kindred Products 7,504 7.3%

39 Misc Manufacturing Products 3,012 5.2% 9 Fresh Fish or Marine Products 5,492 5.3%

27 Printed Matter 2,483 4.3% 27 Printed Matter 4,922 4.8%

37 Transportation Equipment 1,535 2.7% 37 Transportation Equipment 3,371 3.3%

26 Pulp, Paper or Allied Products 855 1.5% 38 Instrum, Photo & Optical Eq 3,013 2.9% All Others 3,231 5.6% All Others 3,598 3.5%

Total 57,429 Total 102,924

Generally, high-value cargo such as electronics, industrial and consumer goods as well as perishable cargo such as foods and pharmaceuticals are flown by air. Machinery is estimated to be the largest commodity by weight and value that is flown into Cincinnati, although miscellaneous mixed shipments will overtake it during the forecast period, growing at an average annual rate of 3.8 percent compared to 1 percent for machinery. Miscellaneous manufacturing products and photo and optical equipment will both grow by more than 4 percent per year on average by volume.

Table 30: Top Inbound Air Commodities by Value, 2009, 2040 (Millions)

2009 2040


35 Machinery $127 34.2% 35 Machinery $185 20.0%

37 Transportation Equipment $52 14.1% 36 Electrical Equipment $175 18.9%

28 Chemicals or Allied Products $50 13.5% 28 Chemicals or Allied Products $173 18.7%

36 Electrical Equipment $35 9.4% 37 Transportation Equipment $126 13.6%

46 Misc Mixed Shipments $28 7.5% 39 Misc Manufacturing Products $94 10.1%

39 Misc Manufacturing Products $24 6.5% 46 Misc Mixed Shipments $89 9.6%

9 Fresh Fish or Marine Products $15 4.1% 38 Instrum, Photo & Optical Eq $36 3.9%

38 Instrum, Photo & Optical Eq $14 3.8% 27 Printed Matter $18 2.0%

27 Printed Matter $9 2.3% 9 Fresh Fish or Marine Products $13 1.5%

20 Food or Kindred Products $6 1.5% 20 Food or Kindred Products $6 0.7% All Others $11 3.1% All Others $10 1.0%

Total $371 Total $926


Outbound

The South and West are the largest destinations of outbound air traffic by both volume and value for the Cincinnati area. All air traffic heading to the South and West is comprised of miscellaneous mixed shipments. It will remain the largest destination throughout the forecast period with a strong average annual growth rate of 3.8 percent. The Northeast is another significant destination of air cargo from the Cincinnati region and another destination whose air cargo traffic is comprised entirely of miscellaneous mixed shipments such as small packages.

Table 31: Air Cargo by Destination, 2009-2040

Destination Region 2009 2015 2020 2030 2040 2009-2040 CAGR

Tons

South & West 14,439 17,919 22,606 34,003 46,324 3.8%

Northeast 12,173 16,401 20,039 26,665 32,680 3.2%

California 7,538 9,902 11,941 16,037 20,753 3.3%

Southeast 6,552 8,136 9,537 12,107 14,916 2.7%

Tennessee 5,269 7,476 9,287 13,020 17,685 4.0%

Texas 3,124 4,045 4,820 6,366 8,267 3.2%

Midwest 2,508 3,353 4,010 5,389 6,958 3.3%

Ohio 1,826 2,221 2,446 3,083 3,977 2.5%

Washington 1,031 1,258 1,514 2,054 2,665 3.1%

Mexico 255 355 430 651 1,006 4.5%

Eastern Canada 233 300 364 529 784 4.0%

Indiana 1 1 2 2 3 3.0%

Michigan 0 0 0 0 1 3.0%

Western Canada 0 0 0 0 0 4.9%

Total 54,948 71,368 86,998 119,909 156,019 3.4%

Value (Thousands)

South & West $64,059 $79,498 $100,296 $150,859 $205,521 3.8%

Northeast $54,005 $72,764 $88,906 $118,303 $144,988 3.2%

California $33,402 $43,906 $52,968 $71,164 $92,107 3.3%

Southeast $29,071 $36,104 $42,319 $53,727 $66,193 2.7%

Tennessee $23,374 $33,167 $41,203 $57,764 $78,460 4.0%

Texas $13,997 $18,143 $21,620 $28,537 $36,965 3.2%

Midwest $11,127 $14,876 $17,790 $23,910 $30,869 3.3%

Ohio $10,471 $13,356 $15,146 $19,783 $25,704 2.9%

Washington $5,325 $6,484 $7,812 $10,546 $13,394 3.0%

Mexico $19,356 $28,017 $36,048 $61,258 $104,870 5.6%

Eastern Canada $24,822 $33,393 $42,324 $66,485 $106,340 4.8%

Indiana $5 $6 $7 $10 $12 3.0%

Michigan $1 $1 $2 $2 $3 3.0%

Western Canada $13 $19 $23 $36 $55 4.9%

Total $289,030 $379,735 $466,463 $662,383 $905,482 3.8%


Mexico, Eastern Canada and Tennessee are some of the fastest growing destinations, indicating that the Cincinnati area will be growing its air cargo exports. Much of the growth in value of air exports to Mexico will be driven by fast growing, high-value commodities such as pharmaceuticals, machinery and electrical equipment. Major fast growing exports to Eastern Canada are expected to be machinery, electrical equipment and transportation equipment.

Miscellaneous mixed shipments are by far the largest commodity moving out of Cincinnati by air, which is reflective of parcel carriers such as UPS and FEDEX. The volume of these shipments is expected to triple over the forecast period, growing at about 3.5 percent, slightly faster than expected growth in domestic air cargo as a whole.

Table 32: Top Outbound Air Commodities by Volume, 2009, 2040 (Thousands)

2009 2040



Total

46 Misc Mixed Shipments 52,989 96.4% 46 Misc Mixed Shipments 151,773 97.3%

27 Printed Matter 610 1.1% 35 Machinery 784 0.5%

35 Machinery 278 0.5% 38 Instrum, Photo & Optical Eq 688 0.4%

37 Transportation Equipment 275 0.5% 27 Printed Matter 676 0.4%

38 Instrum, Photo & Optical Eq 194 0.4% 28 Chemicals or Allied Products 614 0.4%


Total 54,948 Total 156,019

Table 33: Top Outbound Air Commodities by Value, 2009, 2040 (Millions)

2009 2040

STCC Commodity Description Value%

Total STCC Commodity Description Value % Total

46 Misc Mixed Shipments $235 81.3% 46 Misc Mixed Shipments $673 74.4%

35 Machinery $18 6.2% 35 Machinery $77 8.5%

28 Chemicals or Allied Products $10 3.4% 36 Electrical Equipment $52 5.8%

36 Electrical Equipment $9 3.2% 28 Chemicals or Allied Products $43 4.8%

38 Instrum, Photo & Optical Eq $5 1.8% 38 Instrum, Photo & Optical Eq $25 2.8%


Total $289 Total $905


BARGE FREIGHT FLOWS

Overview

Barge traffic in the Cincinnati area comes from and goes to most of the Mississippi River system, but is concentrated in the upper Mississippi and Ohio River segments. Less than 10 percent of total freight traffic1 in the region by volume travels by barge. Since commodities that are traditionally transported by barge are expected to have some of the slowest growth rates over the forecast period, barge traffic will comprise less than 7 percent of total freight tons by 2040. Barges account for less than 3 percent of total freight value moved in the area, a share that will drop to more than 1 percent by the end of the forecast period.

Figure 24: Barge Flows, 2009

About 80 percent of barge traffic is inbound. However, due to higher growth in outbound traffic, inbound barge traffic’s share will drop to about 69 percent by 2040. Barge movements within the Cincinnati region are negligible, as most commodities traveling such a short distance will move by truck.

1 Excluding through rail traffic.


Table 34: Barge Traffic by Direction, 2009-2040

Direction 2009 2015 2020 2030 2040

2009-2040

CAGR

Tons (Thousands)

Inbound 17,411 17,647 17,187 16,262 15,763 ‐0.3%

Intra 111 124 128 137 152 1.0%

Outbound 4,127 5,065 5,392 6,051 6,934 1.7%

Total 21,649 22,836 22,706 22,450 22,848 0.2%

Value (Millions)

Inbound $5,046 $5,871 $5,991 $5,903 $5,948 0.5%

Intra $37 $40 $41 $45 $50 1.0%

Outbound $1,035 $1,321 $1,428 $1,553 $1,717 1.6%

Total $6,117 $7,232 $7,460 $7,501 $7,716 0.8%

Inbound

Six out of the eight counties in the Cincinnati study area have barge terminals along the Ohio River. With 60 percent of total inbound barge traffic by volume, Hamilton County, Ohio receives by far the most inbound barge traffic, followed by Kenton County, Kentucky with about 23 percent. Dearborn County, Indiana and Boone and Campbell counties in Kentucky will have the fastest anticipated annual growth rates but from base levels.

Table 35: Inbound Barge Traffic by County, 2009-2040

County 2009 2015 2020 2030 2040

2009-2040

CAGR

Tons (Thousands)

Boone, KY 612 703 759 925 1,049 1.8%

Campbell, KY 429 571 626 703 767 1.9%

Clermont, OH 1,498 1,507 1,530 1,434 1,343 ‐0.4%

Dearborn, IN 516 617 679 854 992 2.1%

Hamilton, OH 10,366 10,620 10,195 9,154 8,603 ‐0.6%

Kenton, KY 3,991 3,630 3,398 3,193 3,009 ‐0.9%

Total 17,411 17,647 17,187 16,262 15,763 ‐0.3%

Value (Millions)

Boone, KY $355 $409 $439 $500 $568 1.5%

Campbell, KY $248 $304 $344 $380 $443 1.9%

Clermont, OH $169 $201 $212 $222 $238 1.1%

Dearborn, IN $238 $276 $298 $357 $417 1.8%

Hamilton, OH $3,161 $3,778 $3,759 $3,408 $3,179 0.0%

Kenton, KY $875 $903 $939 $1,036 $1,102 0.7%

Total $5,046 $5,871 $5,991 $5,903 $5,948 0.5%


Coal is the largest inbound barge commodity with nearly half of total inbound volume. Its share will fall to less than 38 percent by 2040 however, due to higher growth in commodities such as primary metal products, which will grow by 1.7 percent per year on average, compared to an average annual decline of about 1.2 percent in inbound barge coal movements. As more coal-fired power plants install scrubbers, low-sulfur coal shipments from Appalachia are expected to decline and coal is expected to be procured more locally in Ohio and other states in the Midwest.

Higher value-added products such as petroleum and coal products and chemicals comprise the majority of inbound barge movements by value.

West Virginia is the largest single source of inbound barge traffic, with coal accounting for about 88 percent of its volume, and the majority of the remaining volume being petroleum or coal products. The second largest supplying region by volume is the Lower Mississippi, which primarily sends chemicals, primary metals and petroleum or coal products. These products are of higher value per ton than coal, making the Lower Mississippi the largest supplier of barge traffic by value. The Lower Mississippi is also expected to be the one major region with growth in inbound barge traffic to Cincinnati.

Table 36: Origins of Inbound Barge Traffic, 2009-2040

Origin Region 2009 2015 2020 2030 2040

2009-2040

CAGR

Tons (Thousands)

West Virginia 5,219 4,715 4,495 4,373 4,255 ‐0.7%

Lower Mississippi 4,033 4,895 5,045 4,883 4,916 0.6%

Kentucky 2,942 2,706 2,477 2,179 1,951 ‐1.3%

Indiana 1,944 2,008 1,922 1,802 1,743 ‐0.4%

Upper Mississippi 1,363 1,529 1,537 1,454 1,365 0.0%

Pennsylvania 1,136 986 916 833 782 ‐1.2%

Ohio 517 523 501 448 448 ‐0.5%

Other 256 285 294 290 302 0.5%

Total 17,411 17,647 17,187 16,262 15,763 ‐0.3%

Value (Millions)

West Virginia $601 $569 $579 $635 $684 0.4%

Lower Mississippi $2,901 $3,667 $3,840 $3,808 $3,915 1.0%

Kentucky $279 $314 $304 $269 $235 ‐0.6%

Indiana $664 $692 $661 $626 $589 ‐0.4%

Upper Mississippi $505 $534 $515 $475 $433 ‐0.5%

Pennsylvania $48 $44 $42 $39 $37 ‐0.8%

Ohio $18 $18 $17 $16 $17 ‐0.2%

Other $32 $33 $33 $35 $38 0.6%

Total $5,046 $5,871 $5,991 $5,903 $5,948 0.5% Note: “Other” region is for areas outside the Mississippi River system such as shipments along the Gulf Coast.


Table 37: Top Inbound Barge Commodities by Volume, 2009, 2040 (Thousands)

2009 2040



Total

11 Coal 8,696 49.9% 11 Coal 5,960 37.8%


14 Nonmetallic Minerals 1,943 11.2% 14 Nonmetallic Minerals 2,202 14.0%


33 Primary Metal Products 858 4.9% 33 Primary Metal Products 1,448 9.2%



Table 38: Top Inbound Barge Commodities by Value, 2009, 2040 (Millions)

2009 2040



Total

29 Petroleum or Coal Products $2,094 41.5% 29 Petroleum or Coal Products $2,182 36.7%

28 Chemicals or Allied Products $1,363 27.0% 33 Primary Metal Products $1,684 28.3%

33 Primary Metal Products $986 19.5% 28 Chemicals or Allied Products $1,362 22.9%

11 Coal $290 5.8% 35 Machinery $226 3.8%

35 Machinery $98 1.9% 11 Coal $199 3.3%


Total $5,046 Total $5,948


Outbound

Farm products, mostly grains, are the largest outbound barge commodity by both volume and value. It will grow at an average annual rate of 2.1 percent over the forecast period. Aggregates such as clay, concrete, glass and stone will grow even faster at about 3.1 percent per year to become the second largest outbound barge commodity by volume.

Hamilton County accounts for nearly three quarters of all outbound barge shipments from the Cincinnati area. Its share of outbound freight will rise to more than 80 percent by the end of the forecast period, as it is the fastest growing source of outbound traffic by volume. Clermont County accounts for less than one quarter of outbound barge freight.

Table 39: Outbound Barge Traffic by County, 2009-2040

County 2009 2015 2020 2030 2040

2009-2040

CAGR

Tons (Thousands)

Boone, KY 60 76 81 91 104 1.8%

Campbell, KY 195 248 263 293 332 1.7%

Clermont, OH 868 1,072 989 897 795 ‐0.3%

Dearborn, IN 0 0 0 0 0 1.0%

Hamilton, OH 2,958 3,612 3,997 4,701 5,625 2.1%

Kenton, KY 46 58 62 69 78 1.8%

Total 4,127 5,065 5,392 6,051 6,934 1.7%

Value (Millions)

Boone, KY $5 $6 $6 $6 $7 1.3%

Campbell, KY $16 $18 $19 $20 $23 1.2%

Clermont, OH $155 $232 $244 $227 $210 1.0%

Dearborn, IN $0 $0 $0 $0 $0 0.6%

Hamilton, OH $855 $1,060 $1,155 $1,294 $1,472 1.8%

Kenton, KY $4 $4 $5 $5 $6 1.4%

Total $1,035 $1,321 $1,428 $1,553 $1,717 1.6%


More than half of outbound barge freight, primarily farm products, is destined for the Lower Mississippi. Aside from the rest of Ohio, it is also the fastest growing recipient of Cincinnati’s barge goods.

Table 40: Destinations of Outbound Barge Traffic, 2009-2040


2009-2040

CAGR

Tons (Thousands)

Lower Mississippi 2,457 3,043 3,391 3,966 4,672 2.1%

Pennsylvania 486 624 593 550 508 0.1%

West Virginia 435 529 475 429 377 ‐0.5%

Indiana 268 294 285 276 264 0.0%

Ohio 242 300 361 518 764 3.8%

Kentucky 152 189 207 238 275 1.9%

Other 54 48 43 41 44 ‐0.7%

Upper Mississippi 34 39 37 33 31 ‐0.3%

Total 4,127 5,065 5,392 6,051 6,934 1.7%

Value (Millions)

Lower Mississippi $587 $768 $863 $974 $1,102 2.1%

Pennsylvania $121 $179 $184 $168 $154 0.8%

West Virginia $20 $22 $19 $17 $16 ‐0.7%

Indiana $189 $208 $202 $195 $186 0.0%

Ohio $52 $65 $78 $111 $164 3.8%

Kentucky $45 $53 $57 $65 $73 1.6%

Other $4 $4 $4 $4 $4 0.3%

Upper Mississippi $17 $22 $22 $18 $16 ‐0.3%

Total $1,035 $1,321 $1,428 $1,553 $1,717 1.6%


Table 41: Top Outbound Barge Commodities by Volume, 2009, 2040 (Thousands)

2009 2040

STCC Commodity Description

Tons %

Total STCC Commodity Description

Tons %

Total

1 Farm Products 1,983 48.0% 1 Farm Products 3,787 54.6%

11 Coal 816 19.8% 32 Clay, Concrete, Glass, Stone 1,150 16.6%

32 Clay, Concrete, Glass, Stone 445 10.8% 11 Coal 703 10.1%

29 Petroleum or Coal Products 399 9.7% 29 Petroleum or Coal Products 474 6.8%

33 Primary Metal Products 238 5.8% 33 Primary Metal Products 384 5.5%

All Others 246 6.0% All Others 436 6.3%


Table 42: Top Outbound Barge Commodities by Value, 2009, 2040 (Millions)

2009 2040



Total

1 Farm Products $308 29.8% 1 Farm Products $588 34.2%

33 Primary Metal Products $274 26.5% 33 Primary Metal Products $446 25.9%

29 Petroleum or Coal Products $271 26.2% 29 Petroleum or Coal Products $323 18.8%

32 Clay, Concrete, Glass, Stone $104 10.1% 32 Clay, Concrete, Glass, Stone $262 15.2%

20 Food or Kindred Products $29 2.8% 20 Food or Kindred Products $47 2.8%


Total $1,035 Total $1,717


HAZARDOUS MATERIALS

Hazardous materials comprise more than 5 percent of total freight volume and value in the Cincinnati area. Less than 4 percent of rail movements are of hazardous material however, whereas almost 10 percent of water shipments are hazardous, because petroleum products and chemicals make up a large share of barge traffic.

Growth in hazardous material volume is expected to be about 0.7 percent per year by volume, or half the rate of overall freight growth in the area. By the end of the forecast period, hazardous materials will account for just over 4 percent of total freight volumes. Hazardous materials will also grow slower in value than the overall freight rate of 2.5 percent.

Table 43: Hazardous Materials Traffic by Mode, 2009-2040

Mode 2009 2015 2020 2030 2040

2009-2040

CAGR

Tons (Thousands)

Air 5 5 6 6 7 0.6%

Rail 702 765 785 764 731 0.1%

Truck 8,913 9,949 10,263 10,792 11,669 0.9%

Water 2,090 2,209 2,208 2,168 2,130 0.1%

Total 11,711 12,928 13,262 13,730 14,537 0.7%

Value (Millions)

Air $30 $44 $46 $59 $72 2.9%

Rail $920 $991 $1,054 $1,125 $1,193 0.8%

Truck $9,388 $11,557 $11,992 $14,316 $17,792 2.1%

Water $1,583 $1,678 $1,686 $1,663 $1,644 0.1%

Total $11,922 $14,271 $14,779 $17,162 $20,700 1.8%


Figure 25 presents a close up view of hazardous truck movements in the region. Truck movements account for about three quarters of total hazardous freight volumes. About 52 percent of hazardous truck movements are chemicals and a further 46 percent are petroleum or coal products. The majority of hazardous material truck freight travels north/south along interstate 71, with significant volumes also moving along interstate 75. Interstate 74 does not account for much hazardous material traffic.

Figure 25: Hazardous Materials Flows by Truck, 2009


Through traffic comprises about 38 percent of hazardous material movements in the area. Inbound shipments account for a further 33 percent and outbound shipments for about 28 percent. Inbound traffic is expected to be mostly flat over the forecast period, with the largest growth being in through traffic.

Table 44: Hazardous Materials Highway Flows by Direction, 2009-2040

Direction 2009 2015 2020 2030 2040 2009-2040

CAGR

Tons (Thousands)

Inbound 3,899 4,234 4,247 4,073 3,878 0.0%

Intra 59 68 70 72 72 0.6%

Outbound 3,304 3,637 3,705 3,719 3,752 0.4%

Through 4,447 4,989 5,241 5,866 6,835 1.4%

Total 11,710 12,928 13,262 13,730 14,537 0.7%

Value (Millions)

Inbound $3,619 $4,200 $4,252 $4,575 $5,044 1.1%

Intra $105 $150 $154 $206 $276 3.2%

Outbound $4,069 $5,142 $5,297 $6,434 $8,005 2.2%

Through $4,130 $4,779 $5,077 $5,947 $7,375 1.9%

Total $11,922 $14,271 $14,779 $17,162 $20,700 1.8%

Hazardous material movements via water are by contrast much less balanced than movements by highway. The vast majority of hazardous water shipments - over 90 percent in 2009 - are inbound movements. The growth of these movements is expected to be relatively flat over the forecast period and the ratio of inbound to outbound is expected to stay the same.

Table 45: Hazardous Materials Barge Flows by Direction, 2009-2040

Direction 2009 2015 2020 2030 2040 2009-2040

CAGR

Tons (Thousands)

Inbound 1,892 1,987 1,983 1,933 1,895 0.0%

Intra 19 20 20 22 24 0.7%

Outbound 178 202 205 213 212 0.6%

Total 2,090 2,209 2,208 2,168 2,130 0.1%

Value (Millions)

Inbound $1,443 $1,520 $1,526 $1,495 $1,476 0.1%

Intra $13 $14 $14 $15 $17 0.8%

Outbound $127 $144 $146 $152 $151 0.6%

Total $1,583 $1,678 $1,686 $1,663 $1,664 0.1%

By tonnage, roughly 73 percent of hazardous materials moving by water in 2009 were petroleum or coal products, with the remaining 27 percent chemicals and other allied products. All other products consisted of just 0.2 percent of the total. By 2040, the mix is expected to be 77 percent petroleum products and 24 percent chemicals.


TRUCKLOAD RATES

Table 46 on the following page presents the truckload rates between Cincinnati, Dayton and other major neighboring cities. In general, lanes with more balanced freight will have lower one-way freight rates. For example, if there is twice as much freight moving between Cincinnati and Phoenix as there is moving in the reverse direction between Phoenix and Cincinnati, the rate between Cincinnati and Phoenix will be higher to compensate for the lack of backhaul and to allow the motor carrier to operate profitably.

The rates presented in Table 46 are from the North American Truck Load Rate Index. The index was founded in 1993 by Trans-Research International, Inc. The purpose of the index is to collect truckload motor carrier rates and present them for use for benchmarking purposes by motor carriers, shippers, receivers, or anyone interested in a bench line cost-per-mile for operating a standardized load of goods from point-to-point within North America.

The Index has evolved from obtaining rate data from a combination of carrier rate quotes and paid freight invoices to now relying almost exclusively upon paid freight invoice data. The only visible freight bill information provided to the Index is the rate per mile and verification that the commodity is not hazardous. The shipper and consignee, as well as the motor carrier, are not visible to the Index.

Loads are assumed, and randomly verified to consist of 53 foot dry-van loads with the following features: shipper load/consignee unload, non-hazardous and commodity value not exceeding $250,000. Routes shorter than approximately 440 miles are assumed to utilize a single driver, while longer runs assume driver teams.

The fuel surcharge typically charged by motor carriers is not included in the cents per mile rates provided in the Index. Charging a fuel surcharge – the amount fluctuates widely - has become standard in the truckload industry and thus the actual full cost of shipping between two points will be higher than presented in the table below.

The data provided in Table 46 is from the middle of October, 2010. Every effort is made to verify all lanes and routes for accuracy. Mileages are derived from the latest release of “PC Miler Practical Routes”. However, it must be noted that in the present motor carrier pricing environment, motor carrier rates are especially dynamic and can vary widely in even a shorter period than in the past. While every effort is made to assure most current rates, no warranty is expressed that on a given day, at a given time, the rates expressed in the Index will be obtainable from a motor carrier service provider. Likewise, no warranty or guarantee is expressed that these rates are compensatory to a motor carrier service provider and should not be used as a pricing mechanism by a motor carrier or other transportation service provider.

The Rate Index merely presents a snapshot of an average of average rates paid to move the described loads from point-to-point in North America. Nevertheless, the rates are useful for comparison purposes and as a guide to the relative differences in magnitude between rates on different lanes.


Table 46: Truckload Freight Rates, October 15, 2010 (Cents per Mile)

Indianapolis Evansville Columbus Cincinnati Louisville Lexington Dayton

To From To From To From To From To From To From To From

Birmingham, AL 161 161 166 166 170 156 179 176 170 171 170 169 160 159

Mobile, AL 162 149 168 140 174 148 180 174 171 168 172 172 180 176

Little Rock, AR 154 165 140 169 164 173 171 167 179 160 178 168 172 167

Phoenix, AZ 179 134 183 137 181 140 180 131 182 133 181 138 181 135

Los Angeles, CA 148 133 165 138 167 144 162 130 161 130 163 132 140 162

San Diego, CA 150 135 166 134 172 140 164 130 163 131 160 133 140 160

San Francisco, CA 162 135 167 137 169 141 164 130 165 131 165 134 165 160

Denver, CO 174 129 185 138 188 141 187 141 185 140 135 140 186 141

Atlanta, GA 160 157 160 179 167 169 168 171 165 170 166 174 168 171

Savannah, GA 165 160 168 147 179 155 173 170 174 170 172 172 173 170

Jacksonville, FL 177 138 182 158 180 155 181 155 186 150 185 161 181 155

Miami, FL 205 132 199 143 202 141 205 140 207 123 211 134 206 121

Des Moines, IA 170 158 155 163 170 168 172 171 175 170 175 172 172 171

Boise, ID 189 126 188 139 188 124 191 125 196 120 196 127 193 125

Chicago, IL flat/min rates 190 190 160 187 177 175 178 177 179 179 178 176

Wichita, KS 170 152 162 162 183 177 180 174 173 177 178 180 180 174

New Orleans, LA 175 130 155 139 180 146 158 155 178 141 181 149 151 140

Boston, MA 190 138 197 144 208 121 207 121 205 120 207 122 194 156

Baltimore, MD 188 140 188 176 199 142 190 156 198 130 198 132 200 130

Portland, ME 196 128 188 132 205 128 207 124 202 126 210 143 202 121

Minn/St. Paul, MN 174 148 170 170 175 177 177 161 179 171 181 178 181 123

Missoula, MT 188 120 187 120 197 122 187 123 188 120 197 123 188 120

St Louis, MO 180 180 flat/min rates 182 184 181 185 167 180 185 194 183 181

Jackson, MS 160 140 174 149 182 163 162 144 180 145 180 147 162 144

Charlotte, NC 166 148 184 178 178 170 181 179 178 162 176 167 180 177

Minot, ND 187 121 188 139 188 137 189 136 190 136 192 142 195 118

Omaha, NE 160 148 178 172 171 155 174 155 175 156 177 160 188 120

New York, NY 199 120 199 158 227 131 209 130 210 130 210 134 210 135

Portland, OR 158 136 165 157 166 130 166 129 171 130 174 135 165 129

Philadelphia, PA 186 142 180 138 205 131 201 130 205 132 207 136 209 135

Columbia, SC 155 152 161 164 168 155 170 165 174 170 176 175 170 166

Rapid City, SD 193 120 188 134 188 135 193 133 195 130 196 131 195 130

Nashville, TN 158 145 flat/min rates 182 180 187 184 202 214 207 223 180 187

Memphis, TN 169 140 181 180 178 178 160 169 198 210 201 212 175 157

Dallas/Ft. Worth, TX 177 130 160 144 171 139 178 138 175 130 178 134 185 135

Salt Lake City, UT 187 121 167 140 180 136 182 136 181 130 184 133 197 144

Richmond, VA 182 164 170 155 194 147 194 145 189 144 193 147 196 145

Milwaukee, WI 180 174 180 176 188 184 181 179 183 183 185 182 182 181


APPENDIX A-1: TRANSEARCH® METHODOLOGY

TRANSEARCH®: AN INTRODUCTION

For freight modeling and forecasting, IHS Global Insight produces TRANSEARCH®, an annual database of U.S. county-level freight movement data. TRANSEARCH® includes data flows for more than 450 individual commodities and seven modes of transportation: for-hire truckload, less-than-truckload, private truck, conventional rail, rail/truck intermodal, air, and water. Volume is presented in terms of tonnage, and then translated to units (such as truck counts), value, vehicle-miles travelled (VMT) and ton-miles. For any given county, traffic coverage includes flows that are intra-market (internal), inbound and outbound (external-internal and internal-external), and overhead (external-external) or through traffic.

The TRANSEARCH® capability combines primary shipment data obtained from some of the nation’s largest rail and truck freight carriers with information from public, commercial, and proprietary sources to generate a base year estimate of freight flows at the county level. Once the base year is completed, a separate model is used to produce a 30-year forecast of those flows that are primarily driven by IHS Global Insight’s long-term U.S. Macroeconomic, and Business Markets Insights forecasts. Data from the TRANSEARCH® model have been used by Federal government agencies, more than thirty U.S. states, a multitude of local governments, and is continually used in consulting engagements.

TRANSEARCH® BASE YEAR DEVELOPMENT

Each annual version of the TRANSEARCH® database begins by establishing market-specific production volumes by industry or commodity. For the majority of commodities, including most manufactured goods, this information is drawn from IHS Global Insight's Business Markets Insights (BMI) database, supplemented by trade association and industry reports and U.S. government-collected data. Information from the Input/Output (I/O) tables that are produced by the Bureau of Economic Analysis (BEA) is another key input to the process of estimating production and consumption volumes.

BMI contains a consistent set of historical statistical estimates and forecasts by industry sector at the county level of geographic detail. The statistics include the number of business establishments, employees, and sales by industry at the 6-digit NAICS (North American Industrial Classification System) code level.

The I/O tables contain information on the amount of raw materials that are needed to produce each industry’s output. In other words, these tables simultaneously give information on the amount of commodities that are demanded by each industry, as well as the amount of output generated by each industry.

For the purpose of building TRANSEARCH®, the BMI county-level sales information is used in conjunction with the BEA I/O tables to estimate the value of production and consumption for each commodity at the county level. The NAICS commodities are converted to 4-digit Standard Transportation Commodity Codes (STCCs); for each STCC, there is a price per ton, which is used to translate each commodity from nominal dollars into tonnage.

Commodities for which production volumes are not taken from BMI include agricultural products and livestock (sourced from the U.S. Department of Agriculture); coal and automobiles (sourced from other IHS Global Insight in-house databases); and minerals (sourced from the U.S. Geological Survey).

Using port-level census data, we identify the volume of production that is domestically produced and consumed; that which is domestically produced and exported; and that which is imported and used for domestic production. Therefore, final county-level production numbers include imports and exports.


Additional sources of demand include the public sector, households, and the financial sector. This demand is accounted for by using factors to include state and local tax revenues, wages and salary disbursements (as a proxy for household disposable income), and investments.

Origin/Destination Pairs: Development of Domestic County-to-County Modal Freight Flows

Railroad Traffic Activities

Through a unique partnership with four of the five major Class 1 railroads, IHS Global Insight is able to incorporate county-level data for STCC commodity flows by rail into TRANSEARCH®. Data for the non-participating railroad is estimated from the public-use version of the Surface Transportation Board’s annual Railroad Waybill Sample, a statistically based stratified sample of shipments terminated by all U.S. rail carriers. However, due to non-disclosure agreements with the railways, county-level rail flows can not be publicly shared. TRANSEARCH® thus aggregates and provides BEA-level rail flow data. Tonnage shipped via rail appears in the TRANSEARCH® data set as three separate records: origin truck dray, rail linehaul, and destination truck dray.

Waterborne Commerce Activities

The U.S. Army Corps of Engineers (Corps) annually collects information on all shipments moving on the nation's waterways to support its management and planning activities. TRANSEARCH® uses various components of the data issued by the Corps to develop its waterborne flow data. Although the raw information collected by the Corps is comprehensive, the data released to the public is summarized in ways that mask the details of traffic flows; the TRANSEARCH® data development process aims to re-establish some of this detail.

For freight moving by water, the primary data set used for TRANSEARCH® is the annual Corps file of waterborne commerce, which provides state-to-state annual flows of broad commodity groupings. In addition, the Corps provides data on originating and terminating volumes by port and more specific commodity type. The less detailed state-to-state flow data are disaggregated to the port level using the more detailed origination and termination information, supplemented by in-house research on public and

private port facilities.1 Thus for example, the general flow of goods from Pennsylvania to Louisiana is refined to show the flow of steel products from Pittsburgh-area counties to counties in South Louisiana by comparison of sources. Commodity descriptions adopted by the Corps are transformed to STCCs through data bridges developed and maintained by IHS Global Insight.

Air Cargo Activities

Air cargo represents by far the smallest portion of the TRANSEARCH® database in terms of tonnage. Air activity is constructed using Airport Activity Statistics available through the Bureau of Transportation Statistics (BTS). The BTS T-100 data set reports airport-to-airport flow volumes. The data are then translated from airports to counties, based on airport location information maintained by the Federal

1 Drayage for marine ports is captured in Transearch, through its treatment of import and export traffic. Drayage for inland waterway ports is not captured as a standard part of the database.


Aviation Administration (FAA). In some cases, where there is more than one airport in a county, data are subject to further aggregation. Because the data are meant to portray domestic freight flowing between origin and destination markets, adjustments are made to account for international traffic, and the use of intermediate airport hubs is not depicted. Only cargo that is enplaned or deplaned in an airport is included in the database.

The air cargo data do not specify the commodities moved between airports; therefore, information from the Commodity Flow Survey (CFS) is used to introduce broad commodity identification for air cargo. Using IHS Global Insight expertise, these data are further refined to detail the commodity’s origin at the production region and consumption at the destination region. Finally, TRANSEARCH® also captures the dray portions of air freight shipments, which are the segments moved over the road to and from airports.

Truck Flow Activities

Truck traffic remains the most complex to estimate because of its broader market areas and lack of unified databases. At this point in the production process, total production and consumption volumes are defined at the county level, as well as paired origin/destination commodity flows for freight movements by air, rail, and water. IHS Global Insight then subtracts the known pairings from total production and consumption by county – origin volumes are subtracted from production totals; destination volumes are subtracted from consumption totals. What remains are the production and consumption volumes that must be paired for flows by truck.

From publicly available sources, IHS Global Insight gathers information on the typical distances each commodity is hauled (e.g., less than 100 miles, 100-200 miles, etc.). The distribution by distance for each commodity is fed into a gravity model to determine origin/destination paired flows. IHS Global Insight verifies the origin/destination pairings through a comparison with actual commodity flow data collected from major freight carriers.

The tonnage for each STCC is allocated between the for-hire and private sectors of the industry based on relative volumes reported in the CFS. The for-hire segment is then split between truckload and less-than-truckload (LTL) components using the actual freight carrier industry data on the level of LTL shipments, as well as prior TRANSEARCH® patterns.

TRANSEARCH® FORECAST

The preceding section provided an overview of the process for producing the base year version of TRANSEARCH®. To evaluate future flows, IHS Global insight produces a 30-year forecast using supply- and demand-side factors including employment, output, and purchases by industry and county. County-to-county commodity shipments are forecast at the four-digit STCC commodity code level by leveraging proprietary services from within IHS Global Insight: U.S. Macroeconomic Service, U.S. Agricultural Service, Energy Service, Automotive Service, World Trade Service, Business Transactions Matrix (BTM contains forecasts of the BEA's I/O tables), and Business Markets Insights provide key inputs into the forecast process. This integrated approach to freight flow forecasting ensures that the TRANSEARCH® forecast is completely consistent with the construction of the base year, and, most importantly, with IHS Global Insight's outlook for the U.S. and global economies.

The general process for forecasting freight flows is to produce projections of supply (originating flows) and demand (destination flows) by county and 4-digit STCC. Those flows are then constrained to a national total. This ensures that the sum of individual flows does not exceed the ability to produce commodities at the national level. International flows are included in this process.


APPENDIX A-2: BEA COUNTY COMPOSITION

Cincinnati BEA Counties

Dearborn County, IN

Franklin County, IN

Ohio County, IN

Ripley County, IN

Switzerland County, IN

Boone County, KY

Bracken County, KY

Campbell County, KY

Gallatin County, KY

Grant County, KY

Kenton County, KY

Lewis County, KY

Mason County, KY

Pendleton County, KY

Adams County, OH

Brown County, OH

Butler County, OH

Clermont County, OH

Clinton County, OH

Hamilton County, OH

Highland County, OH

Warren County, OH

Dayton BEA Counties

Champaign County, OH

Clark County, OH

Darke County, OH

Greene County, OH

Miami County, OH

Montgomery County, OH

Preble County, OH

Shelby County, OH

Appendix A: IHS/Global Insight TRANSEARCH Commodity Flow … · Insight TRANSEARCH Commodity Flow...

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