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Commodities that Pulled Down KSU’s Carloads in Week 32

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Aug. 22 2018, Updated 9:31 a.m. ET

KSU’s carload traffic in Week 32

Kansas City Southern’s (KSU), the smallest Class I railroad in the United States, recorded a 5.3% YoY (year-over-year) slump in carload volumes. The company hauled ~24,900 railcars excluding intermodal in the week compared with ~26,300 units in the same period of 2017. KSU’s overall railcar volume growth hasn’t shown a clear trend in 2018. Compared with US railroads’ 1.8% gains, KSU’s railcar traffic excluding intermodal was lower YoY in Week 32.

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Kansas City Southern’s traffic excluding coal and coke commodity groups declined 2.3% YoY in Week 32. The railroad hauled 20,700 in that week compared with ~21,200 in the corresponding period of 2017. KSU’s coal and coke traffic slumped 18% YoY to ~4,200 railcars from ~5,100 units in Week 32 of 2017.

Changes in KSU’s carload commodity groups

The following commodity groups’ volumes jumped in Week 32:

  • food and kindred products
  • lumber and wood products
  • petroleum products
  • stone, clay, and glass products
  • metals and products

The following commodity groups’ volumes declined in Week 32:

  • grain
  • crushed stone, sand, and gravel
  • grain mill products
  • pulp, paper, and allied products
  • motor vehicles and equipment
  • iron and steel scrap
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Intermodal traffic in Week 32

Kansas City Southern reported 1.5% YoY intermodal volumes gains in Week 32 of 2018. The railroad hauled 19,600 containers and trailers in that week compared with 19,300 units in the same period last year.

Containers, which dominate KSU’s intermodal traffic mix, reported 1.1% YoY volume growth in Week 32 to ~19,300 units from ~19,100 units in Week 32 of 2017. Trailer traffic jumped 24.6% YoY in the week. In Week 32 of 2018, Kansas City Southern’s total rail traffic contracted 2.5% in contrast with the 2.8% gains reported by US railroad companies.

KSU stock is included by 73 ETFs in their portfolio holdings. Among them, the iShares Transportation Average ETF (IYT) has the highest exposure to the stock with 5.6% weight. The top holdings of IYT include FedEx (FDX) with 13.37% weight, Norfolk Southern (NSC) with 9.44% weight, and Union Pacific (UNP) with 8.09% weight.

Next, we’ll look into Canadian rail carriers’ rail traffic beginning with Canadian National Railway (CNI).

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