Genesee & Wyoming announces traffic in Nov 2012 was 75,048 carloads, a decrease of 5,406 carloads, or 6.7%, compared with Nov 2011: GWI's traffic in November 2012 was 75,048 carloads, a decrease of 5,406 carloads, or 6.7 percent, compared with November 2011. GWI's traffic in the fourth quarter of 2012 through November was 155,289 carloads, a decrease of 9,496 carloads, or 5.8 percent, compared to the fourth quarter of 2011 through November. Co's RailAmerica unit reported that its total freight carloads for the month ended November 30, 2012 were 70,877, up 1.9% from 69,541 in November 2011.My limited understanding of the railroad industry is that Genesee and Wyoming is a large coal shipper.
Thursday, December 13, 2012
Coal Shippers Struggling -- Not a Bakken Story
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I think they just made a Utica deal for an Ohio short line RR.
ReplyDeleteAn oil field service company on rails ?
Anon 1
Oil service company on rails. I love the "paradigm shift."
DeleteGenesee & Wyoming has a contract to load coal into cars at many of the coal mines of Wyoming and Montana. Once loaded, the trains are turned over to BNSF or Union Pacific for actual shipment. Even so, sometimes the trains end up eventually coming back to the G&W since the G&W operates several dozen "shortline" railroads across the US. For the most part, these are "ma & pa" type of operations that, individually, have a small amount of track, equipment, employees, and customers. However, one customer some of them have is a coal plant that receives coal which may have originally been loaded by a separate division of the G&W hundreds of miles away back at the mines.
ReplyDeleteMost of the G&W shortlines are east of the Mississippi, but there is one in the Upper Midwest that is also pretty representative of the typical G&W operation. The Otter Tail Valley Railroad (OTVR) between Fargo/Moorhead and Fergus Falls, MN was formed in the mid-80s by taking over track Burlington Northern thought was too "small potatoes" for them to keep operating but would still be profitable if a smaller operation with less overhead came in. Today, aside from a lot of agricultural commodities, OTVR hauls coal BNSF turns over in Fargo for ultimate shipment to Otter Tail Power's Hoot Lake Plant near Fergus Falls. How much longer this will occur, though, no one knows as this is one of MN's most endangered coal plants due to its age and relatively low generating capacity.
With that said, on a brighter note, the OTVR has found an additional source of revenue on occasion this fall by getting paid by BNSF to store, on OTVR tracks, empty crude oil trains that are not yet ready to reload in the Bakken region. BNSF learned a while ago in the coal business that sometimes the best thing to do with unit trains that have nowhere to go right away is pay to store them out of the way somewhere.
That's a very interesting comment about "storing" railcars; I had not thought of that flexibility. The Alaskan pipeline was at risk when the amount of oil flowing dropped below a certain level. Not an issue for railroads.
DeleteThank you for such a long and informative post. Much appreciated. It will be interesting to follow the OTVR, to see if it survives.