Here's What Drove Growth in US Rail Freight in Week 39

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Part 4
Here's What Drove Growth in US Rail Freight in Week 39 PART 4 OF 8

What Led Union Pacific’s Volume Fall Last Week?

UNP’s railcar volumes

Union Pacific’s (UNP) overall freight traffic has stayed lower after the impact of Hurricane Harvey. Last week, or the 39th week of 2017 (ended September 30), was no exception, with UNP registering a 3.1% volume loss. Railcar volumes totaled 98,000 units, compared with 101,000 in the week ended October 1, 2016.

Freight volumes fell across categories. Volumes excluding coal and coke were down 1.7% to ~74,500 carloads in the 39th week of 2017, compared with ~76,000 railcars in the comparable week last year. Union Pacific’s coal and coke carloads fell 7.1% to ~23,500, compared with ~25,000 railcars in the same week last year.

What Led Union Pacific&#8217;s Volume Fall Last Week?

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Union Pacific dominates the Western US, competing with Berkshire Hathaway’s BNSF Railway (BRK-B). In terms of the size of freight volumes, BNSF Railway leads its Class-I peers, including UNP.

Gaining and declining commodity groups

The following commodity groups posted volume gains in the 39th week of 2017:

  • crushed stone, sand, and gravel
  • grain mill products
  • lumber and wood products
  • petroleum products (UNG)
  • stone, clay and glass products

The following commodity groups reported a volume loss in the same week:

  • nonmetallic minerals
  • food and kindred products
  • chemicals
  • motor vehicles and equipment (TM)(TSLA)

UNP’s intermodal traffic

Union Pacific reported lower YoY (year-over-year) intermodal volumes in the 39th week of 2017. Containers and trailers fell 0.2% to ~75,000 units.

Container traffic fell 0.4% to over ~72,000 units last week, but trailer volumes stayed in the green zone, expanding 4% to ~3,300 trailers, compared with ~3,200 units in the 39th week of 2016. Compared with the rise in intermodal volumes shown by US railroads, Union Pacific witnessed a volume loss last week.

Now let’s review BNSF Railway (BRK-B).


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