BNSF Railway: Robust Rise in Coal Raises Volumes in Week 15
BNSF Railway’s carloads
BNSF Railway (BRK-B) operates in the Western United States and competes primarily with Union Pacific (UNP). Its total railcars for the week ended April 15, 2017, rose 18.3% YoY (year-over-year) to 95,300 units compared to more than 80,500 units in the corresponding week of 2016.
Carloads other than coal and coke rose 4.4% YoY to ~58,000 units in the week ended April 15, 2017. The rise in BNSF Railway’s overall carloads was similar to the overall rise reported by US railroad companies.
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Why coal matters to BNSF
BNSF Railway saw its coal and coke freight volumes rise 50.0% YoY in the 15th week of 2017, which was double the rise reported by rival UNP. In 2015, coal transportation contributed nearly 22.0% of freight revenues for Berkshire Hathaway’s BNSF Railway, the largest US Class I railroad company.
About 90.0% of that coal originates from the Powder River Basin in Wyoming and Montana. Major coal producers operating in the area include Alpha Natural Resources (ANR) and Peabody Energy (BTU). Environmental concerns and competition from natural gas (UGAZ) have hampered incremental coal shipment prospects for coal producers (ARLP) in 2016.
The commodities that rose in the week ended April 15, 2017, were the following:
- motor vehicles
- sand and gravel
- iron and steel scrap
The prominent declining commodity groups were:
- forest products
- grain mill
- stone, clay, and glass
In the next part, let’s look at BNSF Railway’s intermodal traffic in the week ended April 15, 2017.