Norfolk Southern’s carloads
Norfolk Southern (NSC) and CSX (CSX) run a virtual duopoly in the Eastern United States. In the week ended March 25, 2017, NSC’s overall railcar volumes rose 9.4%. The company saw 72,000 railcars moving in the same week.
There was a 5.0% rise in carloads, excluding coal, for the 12th week of 2017. That week, the rise in NSC’s carloads was slightly behind the rise reported by US railroad companies overall.
Since the beginning of 2017, higher coal volumes boosted NSC’s overall carloads. NSC’s coal (ARLP) carloads rose 21.4% YoY in the week ended March 25, 2017.
Why coal matters to NSC
Coal (CNX) made up ~15.0% of NSC’s 2016 revenue, falling from 23.0% in 2009. However, recent trends in coal prices have rekindled coal producers’ hopes. Norfolk Southern expects to handle 17.0 million–19.0 million tons of utility coal per quarter in 2017.
NSC also anticipates handling 3.5 million–4.5 million tons of export coal in 2017 on a quarterly basis. The tightening of the international coal supply and better seaborne pricing will most likely boost export coal tonnage over the next four quarters.
Leaders and laggards
In the week ended March 25, 2017, the rising commodity groups were as follows:
- crushed stone, sand, and gravel
- iron and steel scrap
- grain mill products
- metals and products
The major falling commodity groups were the following:
- motor vehicles and equipment
- petroleum products
- stone, clay, and glass products
- pulp paper and allied products
- waste and scrap material
In the next part of this series, we’ll take a look at NSC’s intermodal traffic for the week ended March 25, 2017.