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A number of top railroad executives voiced some optimism Tuesday that the steep downturn in freight volumes may have bottomed, although they cautioned that a recovery will take time.

"We have found the bottom and it is a good one," said Claude Mongeau, chief financial officer of Canadian National Railway Co. (CNI). "We are finding a floor to this economic contraction."

He cited sequential weekly improvement in his railroad's freight volumes over the past 14 to 16 weeks.

Representatives of Norfolk Southern Corp. (NSC) and Burlington Northern Santa Fe Corp. (BNI), who took part in a Webcast panel discussion with Mongeau at an RBC Capital Markets transportation conference in Toronto, said they've seen sequentially rising volumes as well over the past few weeks.

There's no doubt that volumes remain way down overall, with Norfolk Southern reporting August volume off 20% from the year-ago period. But the figure marks relative improvement from a 22% decline in July.

"It does appear that we have experienced a bottom in the economy," Norfolk Southern Chief Financial Officer Jim Squires said.

Thomas N. Hund, Burlington Northern's chief financial officer, cited a similar trend, saying he has "seen a modest uptick in our volumes over the last six or seven weeks."

Volumes for all modes of freight transport have fallen precipitously over the past year as the broad economic downturn sapped demand.

Mongeau, who will become Canadian National's chief executive on Jan. 1, stressed that it will take time for a full recovery, despite his optimism that the deterioration has stopped.

"We don't think that the recovery will be very rapid," he said, estimating that it could take three to four years to achieve pre-downturn economic activity.

-By Bob Sechler; Dow Jones Newswires; 512-394-0285; bob.sechler@dowjones.com