Railroads riding the Bakken Boom

Rail roads seem to define America, from the Golden Spike to the Singing Brakeman. We love them, we hate them, we ride them, we wait for them.  The rail industry, however, isn’t waiting for us, growing traffic where it can.  Recently the rail industry has been in the spotlight, pro and con, as the work horse transporting Bakken crude out of the Dakotas to an energy-hungry nation.

Warren Buffett has committed major capital to BNSF (Burlington Northern Santa Fe) Railway, which grew shipments by 4.5% last year compared to Union Pacific’s 0.3% growth.  I guess we’re starting to see why Berkshire Hathaway bought the nation’s 2nd largest railroad four years ago.

The Association of American Railroads represents North American railroad companies.  They are promoting joint development of pipeline and rail freight infrastructure for energy development:  “U.S. freight railroads transported nearly 234,000 carloads of crude oil in 2012, up from just 9,500 carloads in 2008. Early data suggest that rail carloads of crude surpassed 400,000 in 2013.”

AAR supplies weekly summaries of rail traffic, as a teaser to buy more detailed info. It is interesting nonetheless.

FOR IMMEDIATE RELEASE

AAR Reports Increased Weekly Rail Traffic

WASHINGTON, D.C. – Jan. 30, 2014 – The Association of American Railroads (AAR) today reported increased U.S. rail traffic for the week ending Jan. 25, 2014 with 280,761 total U.S. carloads, up 5.6 percent compared with the same week last year. Total U.S. weekly intermodal volume was 245,883 units up 3 percent compared with the same week last year. Total combined U.S. weekly rail traffic was 526,644 carloads and intermodal units, up 4.4 percent compared with the same week last year.

Seven of the 10 carload commodity groups posted increases compared with the same week in 2013, including grain with 23,175 carloads, up 24.4 percent; and, petroleum and petroleum products with 15,211 carloads, up 13.1 percent. Commodities showing a decrease compared with the same week last year included metallic ores and metals with 22,539 carloads, down 1.8 percent.

For the first four weeks of 2014, U.S. railroads reported cumulative volume of 1,074,281 carloads, up 0.9 percent from the same point last year, and 936,176 intermodal units, up 1.8 percent from last year. Total combined U.S. traffic for the first four weeks of 2014 was 2,010,457 carloads and intermodal units, up 1.3 percent from last year.

Canadian railroads reported 74,311 carloads for the week, down 1.6 percent, and 52,824 intermodal units, up 1.7 percent compared with the same week in 2013. For the first four weeks of 2014, Canadian railroads reported cumulative volume of 281,220 carloads, down 5.3 percent from the same point last year, and 198,167 intermodal units, down 1.5 percent from last year.

Mexican railroads reported 16,416 carloads for the week, up 8.9 percent compared with the same week last year, and 10,542 intermodal units, up 6.7 percent. Cumulative volume on Mexican railroads for the first four weeks of 2014 was 56,896 carloads, up 6.1 percent from the same point last year, and 35,739 intermodal units, up 3.2 percent from last year.

Combined North American rail volume for the first four weeks of 2014 on 13 reporting U.S., Canadian and Mexican railroads totaled 1,412,397 carloads, down 0.2 percent compared with the same point last year, and 1,170,082 intermodal trailers and containers, up 1.3 percent compared with last year.

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Implications for communities, especially rural communities?  Watch your rail crossings, since there may be more traffic coming.  Train your firefighters for petroleum and ethanol spills.  And while decades of branch line abandonment might go on hold, keep in touch with your grain elevators and smaller freight users who may just get overlooked as consolidated railroads focus on the big shippers and their unit trains.  We’re all in this together.

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