Last week we reported the Railway Age data regarding Class 1 railroad carloads. Today we focus on the major differences year-over-year shown in the data. The biggest upswing was in farm product shipments (primarily covered hoppers, including PD covered hoppers). The data reported for changes in grain mill products for short lines saw a similar increase – at 22.3%, the single largest increase. Yet the overall trend was down for March, with significant declines in metallic ores (hopper cars), motor vehicles and equipment (flatcars, autorack cars, and boxcars), and coal (open top hoppers and gondolas). Coal appears to have been the biggest loser in carloads, likely due to the drop in energy consumption and the plummeting price of petroleum products.
What lies ahead? We assume carload shipments will increase over time as closed factories startup. This will likely result in an increased demand for gondola, open-top hopper, and similar ore cars, along with further demand for boxcars and flatcars. While the overall demand for petroleum products and chemicals (mostly tankcars) has been strong, it isn’t clear this demand will continue and normal market conditions return. No one knows exactly how the opening of the economy will unfold, least of all us. Stay tuned.
Railway Age Data Class 1. Contact RailCarDeals.com or call us at 860-756-0302 or information@RailCarDeals.com. We have the most up to date information
May 26, 2020 – Written by David Brown