Union Pacific’s Rail Traffic Plunged in Week 18

UNP’s rail traffic fell

Union Pacific’s (UNP) rail traffic fell 2.9% YoY (year-over-year) in Week 18, which ended on May 4. The company hauled 167,342 railcars during the week compared to 172,276 railcars in Week 18 of 2018.

Union Pacific’s Rail Traffic Plunged in Week 18

Three of the seven Class I railroad companies registered volume declines during the week, while four recorded increases. Norfolk Southern (NSC) registered the highest volume decline of 4.2%, while Canadian Pacific Railway (CP) reported the highest gain of 4.5%.

Union Pacific’s dismal rail traffic performance was mainly the result of a 5.8% fall in its intermodal volumes. During the week, the company carried 73,352 containers and trailers compared to 77,851 units in Week 18 of 2018. The company’s container volumes fell 5.6% YoY to 70,482 units from 74,629 units, while its trailer volumes plunged 10.9% YoY to 2,870 units from 3,222 units.

During Week 18, three of the seven Class I railroad companies recorded lower intermodal units. CSX (CSX) saw the highest volume decline of 9.7%. Canadian Pacific Railway registered the highest YoY rise of 9.6%.

Carload traffic fell

Lower carload volumes also dragged on Union Pacific’s overall rail traffic in Week 18. The company’s carload traffic inched down 0.5% YoY to 93,990 railcars from 94,425 railcars in Week 18 of 2018. Its carload volumes excluding coal and coke fell 1.2% YoY to 74,387 units, while its coal and coke traffic increased 2.5% YoY to 19,603 units from 19,132 units.

Union Pacific recorded carload traffic declines across the farm, food, metallic ore, coke, metals, iron, steel, metals, and motor vehicles and equipment commodity groups. The company registered volume growth across coal, nonmetallic minerals, forest, chemicals, and petroleum products.

Except for Union Pacific and Norfolk Southern, every major Class I railroad company reported carload volume growth in Week 18. Union Pacific recorded a carload traffic fall of 0.5%. Canadian National Railway (CNI) registered the highest carload volume gain among all Class I railroad companies at 6.5%.

Union Pacific stock has gained ~27% YTD (year-to-date), outperforming the returns of the SPDR S&P Transportation ETF (XTN), which tracks the performances of transportation stocks in the United States and has allocated 42.8% of its funds to the ground freight and logistics industry. The ETF has gained 15% YTD.