CSX’s Freight Volumes: Commodities That Led to the Week 14 Rise
CSX’s freight volumes
In the week ended April 8, 2017, CSX’s (CSX) overall railcar volumes rose to 4.0% YoY (year-over-year). That week, its freight volumes were more than 70,000 compared to 68,000 railcars in the corresponding week last year. Its carloads, excluding coal and coke, rose just 0.85% in the same week. There was a rise in rival Norfolk Southern’s (NSC) carloads.
If you want to compare this week’s freight volume data with the previous week’s data, check out Market Realist’s Week 13: US Freight Rail Volumes on a Growth Trajectory.
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CSX’s coal and coke railcar volumes rose to 18.0% in the week ended April 8, 2017. However, NSC posted a remarkable rise of 25.0% in the same category. Coal made up 16.5% of CSX’s volumes in 2016 compared to 19.5% a year ago.
Why is coal vital for CSX?
According to the EIA (U.S. Energy Information Administration), in 2016, coal production fell 18.0%, or 158.0 MMst (million short tons) to 739.0 MMst. That figure represents the lowest level of coal produced since 1978.
In 2017, growth in coal-fired electricity generation is expected to lead to a 7.0% rise in total US coal production, or an additional 51.0 MMst. The majority of the rise will likely come from the Western and interior regions of the United States.
Eastern railroads have cited electricity generation plants’ overall shift from coal to natural gas (UNG) as one of the main reasons for the fall in utility coal transportation. The shift has affected all major US coal producers, including Alliance Resource Partners (ARLP), Consol Energy (CNX), and Peabody Energy (BTU), which declared bankruptcy. However, recent coal price trends backed by increased coal transportation could suggest a revival.
Bull and bear commodity groups
The commodity groups that posted significant rises in the week ended April 8, 2017, were as follows:
- primary metal products
- food products
- lumber and wood products
- non-metallic minerals
- stone, clay, and glass products
The prominent falling commodity groups were as follows:
- primary forest products
- metallic ores
- pulp and paper products
- iron and steel scrap
We’ll look at CSX’s intermodal traffic in the next part of this series.