Canadian Pacific’s carloads
Canadian Pacific (CP) recorded a 10% rise in total carloads in the week ended April 1, 2017. The company hauled over 34,000 railcars during the week, similar to its total carloads in the corresponding week of 2016.
However, for Canadian Pacific, railcars excluding coal rose 13% YoY (year-over-year) to settle at ~28,000 units, compared to 25,000 units in the week ended April 2, 2016.
Canadian Pacific normally earns 70% of its revenues from Canada and 30% from the United States. CP’s non-coal carloads rose to 13% YoY in the 13th week of 2017, whereas Canadian National (CNI) reported a YoY rise of 9.3%.
Why coal carloads matter to CP
Coal accounted for 11% of Canadian Pacific’s (CP) revenues and 12% of its carloads in 2016. The company mainly transports metallurgical coal meant for export through Metro Vancouver’s port. Canadian Pacific’s coal traffic begins primarily at Teck Resources’s (TCK) mines in the southeastern portion of British Columbia.
During the past year, coal production and demand have been under pressure due to depressed prices, environmental concerns, and a shift away from coal-fired power plants to natural gas–based electricity generation. US steel producers’ capacity utilizations didn’t see marked improvements in the recent quarter, either.
In the week ended April 1, 2017, Canadian Pacific’s major rising commodity groups were as follows:
- US grain
- potash products
- metals, minerals, and consumer products
- chemicals and plastic
The major commodity groups that fell were as follows:
- forest products
- crude oil
In the final article in this series, we’ll take a look at the changes in Canadian Pacific’s intermodal traffic.