Coal and Coke Railcars Pull CSX’s Total Railcar Count Down



CSX’s total railcars

CSX Corporation (CSX) is a major operator in the Eastern US. CSX, along with Norfolk Southern (NSC), holds a virtual duopoly in that region. In the week ended April 9, 2016, CSX’s railcars, excluding coal and coke, declined by ~5%.

CSX hauled ~55,000 units in the same week against 58,000 units in the week ended April 11, 2015. CSX’s 16% fall in total railcars was slightly lower than the 20% fall in railcars by selected US railroads for the reported week in 2016.

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Why coal carloads matter

CSX’s coal plus coke railcar count fell by 45% to ~13,000 units in the week ended April 9, 2016. It reached nearly 23,000 railcars in the corresponding period in 2015. This fall was higher compared with its main competitor Norfolk Southern’s fall in coal and coke railcars for the reported week. Coal accounted for 16% of CSX’s total volumes and 19% of its total revenues in 2015.

According to the March 2016 press release by the US Energy Information Administration (or EIA), the Appalachian region’s coal output is expected to fall by 9% in 2016. However, the EIA expects total coal production to increase by 2% and to stabilize in 2017. CSX mainly connects coal mining operations in the Appalachian mountain region. This should impact CSX’s coal transportation in 2016.

The eastern railroads have cited the shift from coal to natural gas (UNG) of electricity generation plants as one of the reasons for the fall in utility coal transportation. The coal tsunami has affected major coal producers in the US like Alliance Resource Partners (ARLP), CONSOL Energy (CNX), and Peabody Energy (BTU).

The bull and bear commodity groups

Commodities that posted major gains for CSX in the week ended April 9, 2016, were:

  • lumber and wood products
  • food products
  • waste and non-ferrous scrap

The major bear commodity groups were farm products excluding grain, petroleum and petroleum products, metallic ores, and primary metal products.

For more information on the last week’s rail traffic, please read Mexican Railroads Shine as US and Canadian Railroads Slump. The intermodal business has witnessed a bumpy ride in the last few quarters for all Class I railroads.


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