Canada forest products freight drops 36% in latest week on CN rail strike

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Canada forest products freight drops 36% in latest week on CN rail strike

November 29, 2019 - 14:34
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SAN FRANCISCO, Nov. 29, 2019 (Fastmarkets RISI) -Canadian total forest products railroad freight fell 36.4% in the week ending Nov. 23, 2019, to 4,621 carloads reflecting a Teamsters strike against CN (Canadian National) that began at midnight Nov. 19, and ended Nov. 26 with a tentative labor agreement.

The strike included 3,200 CN union workers, mainly conductors, which resulted in the rail network running at about 10% of capacity over eight days, the company said.

CN reported its total forest products freight in the week dropped 38.9% with pulp and paper 31.3% lower to 2,094 carloads, lumber and wood products down 48.1% to 1,614 carloads and primary forest products 34.7% lower to 830 carloads.

Year-to-date, CN total forest products freight was down 9.2%, with pulp and paper down 5.4% to 138,482 carloads, lumber/wood down 9.7% to 134,753 carloads and primary forest products down 16.9% to 53,748 carloads.

CN reported its total bulk rail shipments were down 25.6% in the week and down 0.5% year-to-date.

Total Canadian forest products freight through 47 weeks of 2019 was down 8.0% at 320,295 carloads. Total Canadian rail carloads were down 16.4% in the latest week and 0.7% year-to-date, according to the Assn of American Railroads. Forest products showed the steepest drop in the week as CN handles up to 50% of Canadian forest products freight, according to an industry analyst. Coal was down 32%, chemicals were 24% lower, and petroleum 15% lower.

North American forest products freight was 14.7% lower in the week ending Nov. 23 to 14,203 carloads and year-to-date was 5.8% lower at 783,474 carloads. Canadian freight in the sector accounted for 40% of North American traffic year-to-date, and 32% in the latest week.

US forest products freight in the week was up 2.2% to 9,561 carloads and year-to-date was 4.2% lower to 461,911 carloads. Mexico was lower by 4.5% and 4.4% respectively.

Among other carriers, CP (Canadian Pacific) showed its relatively small forest products freight in the week down 1.2% to 1,278 carloads and year-to-date 3.1% higher to 18,457 carloads.

CSX reported its pulp and paper carloads in the week were down 11.7% to 2,901 carloads and through 47 weeks were flat at 137,897 carloads. Lumber/wood products were 6.7% higher in the week to 2,901 carloads and year-to-date were up 3% to 58,697 carloads.

Union Pacific pulp and paper carloads were down 2% in the week at 1,547 carloads and year-to-date were 7% lower to 75,944 carloads. Lumber/wood freight climbed 22% in the week to 2,131 carloads and was 8% lower year-to-date to 106,602 carloads.

BNSF pulp and paper carloads were down 6.2% in the latest week at 1,365 carloads and year-to-date were 1.6% lower to 69,171 carloads. Lumber/wood products in the week were 10.5% lower to 1,280 carloads and year-to-date were 6.6% lower to 75,344 carloads.

--byjmclaren@fastmarkets.com