Storage continues to be active with the return on lease locations still in full swing. There is definite tightening across a few regions while at the same time capacity is being added. Keep in touch with PFL for all your storage needs, as supply and demand is ever changing. If you have a project need to perform maintenance, clean cars or reposition cars in a cost effective manner, call PFL today to trouble shoot your situation.
We are starting to see a significant amount of cars moving out of storage now for crude plays in the Bakken and Alberta and anticipate several thousand crude cars moving into service this month.
Association of American Railroads Rail Time Indicators
The AAR just released its monthly Rail Time Indicators report in which it reports railcars in storage. As of January 1, 2020, there were 408,100 empty railcars in storage, representing 24.4% of the North American fleet. This represented an 11,900 unit increase (+3.0%) from last month and an 110,700 unit increase year over year (+37.2%).
The majority of the increase came from covered hoppers, open-top hoppers and gondolas. Railcars in storage have now increased 14 out of the past 15 months and are at the highest level since August of 2016. This is a negative data point for the railcar manufacturers lessors.
We expect new railcar demand will remain muted in the near term from a combination of soft rail volumes and PSR implementation/faster train speeds. However, watch those tank cars for crude and hoppers for fracsand. With the situation in Iran and spreads making rail favorable for a handful of basins, we should if all remains equal see some relief for lessors
Loaded storage for energy products is still available so call PFL today for availability, locations and rates!
