Canadian Pacific’s carloads
Canadian Pacific’s (CP) total carloads rose marginally 2.1% in the week ended March 25, 2017. The company hauled almost 32,000 railcars in the week, compared to 31,000 in the corresponding week of 2016. However, CP’s railcars, excluding coal, rose 2.6% YoY (year-over-year) to settle at ~26,000 units, compared to 25,000 units in the week ended March 26, 2016.
Canadian Pacific normally earns 70.0% of its revenue from Canada and 30.0% from the United States. Its non-coal carloads rose a slight 2.7% YoY in the 12th week of 2017. Canadian National (CNI) reported a YoY rise of 16.2%.
Why coal carloads matter to CP
Coal accounted for 11.0% of Canadian Pacific’s (CP) revenue and 12.0% of its carloads in 2016. The company mainly transports metallurgical coal meant for export through Port Metro Vancouver. Its coal traffic in Canada begins primarily at Teck Resources’ (TCK) mines in southeast British Columbia.
During the past year, coal production and demand have been under pressure due to depressed prices, environmental concerns, and a shift from coal-fired power plants to natural gas–based electricity generation. US steel producers’ capacity utilizations also didn’t see marked improvements in the recent quarter.
In the week ended March 25, 2017, Canadian Pacific’s major rising commodity groups were as follows:
- US grain
- potash products
- metals, minerals, and consumer products
The major commodity groups that saw falls were as follows:
- Canadian grain
- fertilizer and sulfur
- chemicals and plastic
Next, we’ll take a look at the changes in Canadian Pacific’s intermodal traffic.