uploads///BNSF Carloads

How Did BNSF Railway’s Carloads Trend?

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Mar. 16 2017, Updated 9:06 a.m. ET

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 March 4, 2017, rose 11.4% YoY (year-over-year) to ~100,000 units as compared to nearly 90,000 units in the corresponding week of 2016.

Carloads other than coal and coke grew 3% YoY to 61,000 plus units in the week ended March 4, 2017. The percentage rise in BNSF Railway’s overall carloads was near twice the percentage increase reported by US railroads overall.

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Why coal matters to BNSF

BNSF Railway’s coal and coke railcars rose a whopping 28% in the week ended March 4, 2017, on a YoY basis. This was higher than the rise reported by rival UNP. Coal transportation contributed nearly 22% of freight revenue in 2015 for Berkshire Hathaway’s BNSF, the largest US Class I railroad.

About 90% of this coal originates from the Powder River Basin in Wyoming and Montana. Major coal producers operating in that area include Alpha Natural Resources (ANR) and Peabody Energy (BTU), which has declared bankruptcy. Overall, environmental concerns and competition from natural gas (UGAZ) hampered incremental coal shipment prospects for coal producers (ARLP) in 2016.

Progressing and regressing commodity groups

The main frontrunning commodities for the week ended March 4, 2017, were as follows:

  • grain
  • food
  • metal
  • iron and steel scrap
  • non-metallic minerals

Commodities that witnessed backward movement included the following:

  • chemicals
  • metallic ores
  • stone, clay, and glass
  • forest products
  • waste and scrap

In the next part, we’ll look at BNSF Railway’s intermodal traffic.

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