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Behind BNSF Railway’s Double-Digit Volume Rise in Week 19

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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 May 13, 2017, rose 11.6% YoY (year-over-year) to 90,000 units, compared to ~81,000 units in the corresponding week of 2016.

Its carloads other than coal and coke rose 12.7% YoY to ~60,000 units in the week ended May 13, 2017. The rise in BNSF Railway’s overall carloads was higher than the overall rise reported by US railroad companies.

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Coal’s importance to BNSF

BNSF Railway saw its coal and coke freight volumes rise 9.5% YoY in the 19th week of 2017, lower than the rise reported by rival UNP. Coal transportation accounts for nearly 21.0% of BNSF’s total freight revenue.

About 90.0% of BNSF’s coal originates from the Powder River Basin in Wyoming and Montana. Major coal producers operating in the area include Alpha Natural Resources (ANR) and Peabody Energy (BTU). Environmental concerns and competition from natural gas (UGAZ) hampered incremental coal shipment prospects for coal producers (ARLP) in 2016.

Commodity groups

The commodities that rose in the week ended May 13, 2017, were the following:

  • grain
  • food
  • sand and gravel
  • metal
  • motor vehicles

The main falling commodity groups were:

  • petroleum
  • forest products
  • stone clay and glass
  • pulp and paper

In the next article, we’ll look at BNSF Railway’s intermodal traffic in the week ended May 13, 2017.

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