Posted on by Curtis Chandler Posted in Railcar Report

“What we observe is not nature itself, but nature exposed to our method of questioning.”

– Werner Heisenberg

Jobs Update

  • Initial jobless claims for the week ending July 22nd, 2023 came in at 221,000, down -7,000 people week-over-week.
  • Continuing jobless claims came in at 1.690 million people, versus the adjusted number of 1.749 million people from the week prior, down -59,000 people week over week.

Stocks closed higher on Friday of last week and higher week over week

The DOW closed higher on Friday of last week, up +176.57 points (+0.5%), closing out the week at 35,459.29, up +231.6 points week over week. The S&P 500 closed higher on Friday of last week, up +44.82 points (+0.99%) and closed out the week at 4,582.23, up +45.89 points week over week. The NASDAQ closed higher on Friday of last week, up +266.55 points (+1.89%), and closed the week at 14,316.66, up 225.86 points week over week.

In overnight trading, DOW futures traded higher and are expected to open at 35,619 this morning up +27 points.

Crude oil closed up on Friday of last week, and higher week over week

WTI traded up $0.49 per barrel (0.61%) to close at $80.58 per barrel on Friday of last week, up $3.51 per barrel week over week. Brent traded up US$0.75 per barrel (0.89%) on Friday of last week, to close at US$84.99 per barrel, up US$3.92 per barrel week over week.  

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 600,000 barrels week over week. At 456.8 million barrels, U.S. crude oil inventories are 2% above the five-year average for this time of year.

Total motor gasoline inventories decreased by 800,000 barrels week over week and are 7% below the five-year average for this time of year.

Distillate fuel inventories decreased by 200,000 barrels week over week and are 14% below the five-year average for this time of year.

Propane/propylene inventories increased by 1 million barrels week over week and are 23% above the five-year average for this time of year.

Propane prices closed at 64 cents per gallon, up 3 cents per gallon week over week, but down 47 cents per gallon year over year.

Overall, total commercial petroleum inventories decreased by 500,000  barrels during the week ending July 22nd, 2023.

U.S. crude oil imports averaged 6.4 million barrels per day during the week ending July 22nd, 2023, a decrease of 807,000 barrels per day week over week. Over the past four weeks, crude oil imports averaged 6.6 million barrels per day, 1% more than the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) averaged 754,000 barrels per day, and distillate fuel imports averaged 160,000 barrels per day during the week ending July 22nd, 2023.

U.S. crude oil exports averaged 4.591 million barrels per day for the week ending July 22nd, 2023, an increase of 777,000 barrels per day week over week. Over the past four weeks, crude oil exports averaged 3.613 million barrels per day.

U.S. crude oil refinery inputs averaged 16.5 million barrels per day during the week ending July 22, 2023, which was an increase of  07,000 barrels per day week over week.

WTI is poised to open at 80.60, up 2 cents per barrel from Friday’s close.

North American Rail Traffic

Week Ending July 26th, 2023.

Total North American weekly rail volumes were down (-3.27%) in week 29, compared with the same week last year. Total carloads for the week ending on July 26th, 2023 were 343,707, down (-0.4%) compared with the same week in 2022, while weekly intermodal volume was 314,991, down (-6.21%) compared to the same week in 2022. 6 of the AAR’s 11 major traffic categories posted year-over-year increases with the most significant decrease coming from Grain (-17.09%). The largest increase came from Motor Vehicles and Parts (+20.8%).

In the East, CSX’s total volumes were down (-2.72%), with the largest decrease coming from Grain (-12.25%) and the largest increase from Motor Vehicles and Parts (+19.37%).  NS’s volumes were down (-0.64%), with the largest decrease coming from Petroleum and Petroleum Products (-37.32%) and the largest increase from Other (+23.31%).

In the West, BN’s total volumes were down (-8.3%), with the largest decrease coming from Grain (-31.65%), and the largest increase coming from Motor Vehicles and Parts (+26.43%). UP’s total rail volumes were down (-0.76%) with the largest decrease coming from Forest Products (-18.56%) and the largest increase coming from Motor Vehicles and Parts (+19.20%).

In Canada, CN’s total rail volumes were up (2.55%) with the largest increase coming from Metallic Ores and Metals (+21.08%) and the largest decreases coming from Forest Products (-18.55%). CP’s total rail volumes were down (-9.04%) with the largest decrease coming from Intermodal (-29.10%) and the largest increase coming from Motor Vehicles and Parts (+93.02%).

KCS’s total rail volumes were down (-7.6%) with the largest decrease coming from Farm Products (-30.78%) and the largest increase coming from Motor Vehicles and Parts (+42.21%).

Source Data: AAR – PFL Analytics

Rig Count

North American rig count was up by +1 rig week over week. U.S. rig count was down by -5 rigs week over week and down by -103 rigs year-over-year. The U.S. currently has 664 active rigs. Canada’s rig count was up by 6 rigs week-over-week, but down by -11 rigs year over year.  Canada’s overall rig count is 193 active rigs.  Overall, year-over-year, we are down -114 rigs collectively.

North American Rig Count Summary

A few things we are watching:

We are watching Petroleum Carloads

The four-week rolling average of petroleum carloads carried on the six largest North American railroads fell to 24,957 from 25,034, which was a loss of -77 rail cars week-over-week. Canadian volumes were mixed. CPKC’s shipments decreased by -0.8% week over week, and CN’s volumes were higher by +2.0% week-over-week. U.S. shipments were mostly lower. The BN had the largest percentage decrease and was down by -8% week-over-week.  The UP  was the sole gainer and was up by -0.7%.

We are watching Crude by Rail Out of Canada

The Canadian Energy Regulator (“CER”) updated its monthly crude by rail numbers on July 24, 2023. For May 2023, Canada exported 78,747 barrels per day by rail (down by -1,865 barrels per day month over month) which is the weakest showing since September of 2020, another horrible month.

We were expecting to see volumes increase as we head into the month of July, as the weather warms up and producers build inventory, but that has not been the case with outages and plant turnarounds going on in Canada during this time frame, not to mention the strikes that were not helpful.  With the Trans Mountain Expansion right around the corner of 590,000 barrels per day and line pack to be filled, we don’t expect a  meaningful crude by rail bounce in the short term.  Longer term, however, we are bullish on USD’s and Gibson Bitumen Hardisty expansion and Cenevus’ new Bitumen planned facility. Crude by rail out of Alberta and Saskatchewan is popular for raw Bitumen (no diluent added), as it can be shipped as a non-hazmat product resulting in lower shipping costs that are competitive with pipelines.

The decrease in crude oil shipped by rail out of Canada has had a negative impact on many railroad terminal service providers. With reduced volumes, many rail terminal facilities have experienced lower utilization rates, leading to decreased revenue and profitability. This decline has created challenges in maintaining operational efficiency and maximizing asset utilization.

We are watching The Mountain Valley Pipeline

The U.S. Supreme Court granted Mountain Valley Pipeline LLC’s request to lift construction stays imposed by a lower court, allowing the completion of the long-delayed Mountain Valley Pipeline. The pipeline is a 303-mile natural gas pipeline, with a final 3.5-mile corridor through the Jefferson National Forest. The $6.6 billion project, led by energy company Equitrans Midstream, has faced multiple legal battles since construction began in 2018. Environmental groups have opposed the pipeline, arguing it could harm soil and water quality and increase natural gas usage. However, the pipeline is seen as crucial for unlocking more gas supplies from the Appalachian region. The project is one of several pipelines that have faced delays or cancellations due to environmental and local opposition. The approval of the Mountain Valley project was included in a debt limit deal between President Joe Biden and House Speaker Kevin McCarthy, supported by Democrat Senator Joe Manchin of West Virginia. The Supreme Court’s decision was praised by Manchin.  It looks like all legal means to shut the pipeline down are done and dusted.

We have been extremely busy at PFL with return-on-lease programs involving rail car storage instead of returning cars to a shop.  A quick turnaround is what we all want and need.   Railcar storage in general has been extremely active.  Please call PFL now at 239-390-2885 if you are looking for rail car storage, want to troubleshoot a return on lease scenario, or have storage availability.  Whether you are a car owner, lessor or lessee, or even a class 1 that wants to help out a customer we are here to “help you help your customer!”

Leasing and Subleasing has been brisk as economic activity picks up. Inquiries have continued to be brisk and strong Call PFL Today for all your rail car needs 239-390-2885

Lease Bids

  • 20-30, 14k Any Tanks needed off of BNSF, UP in Texas for 1-3 Years. Cars are needed for use in HCl service. Call for more details
  • Up to 60, 5150cf Covered Hoppers needed off of CN, CSX, NS in the east or midwest for 3 years. Cars are needed for use in Fertilizer service. 3-4 hatch gravity dumps
  • 30-50, 30K 117 Tanks needed off of any class 1 in Northeast or Midwest for 1 Year. Cars are needed for use in C5 service. Must have Magrods
  • 10, any capacity Stainless Steel Tanks needed off of any class 1 in Canada for 5-10 years. Cars are needed for use in Alcohol service.
  • 25-50, 5000CF-5100CF Lined Hoppers needed off of BNSF, CSX, KCS, UP in Gulf LA for 3-10 years. Cars are needed for use in Dry sugar service. 3 bay gravity dump
  • 25, 20.5K CPC1232 or 117J Tanks needed off of BNSF or UP in the west for 3-5 Year. Cars are needed for use in Magnesium chloride service. SDS onhand
  • 25-50, 25.5K 117J Tanks needed off of NS CSX in NorthEast for 5 Years. Cars are needed for use in Asphalt / Heavy Fuel Oil service.
  • 10, 5200cf PD Hoppers needed off of UP in Colorado for 1-3 years. Cars are needed for use in Silica service. Call for details
  • 30-40, 286K DOT 113 Tanks needed off of CN or CP/ UP in Canada/MM for 5 Years. Cars are needed for use in CO2 service. Q1
  • 30, 30K DOT 111 Tanks needed off of UP in Texas for 1-3 Years. Cars are needed for use in Diesel service.
  • 5-7, 28.3K 117R Tanks needed off of NS or CSX in NC for 1 Year. Cars are needed for use in UCO service.
  • 70, 32K 340W Pressure Tanks needed off of CP or CN in Edmonton for 3 Years. Cars are needed for use in Propane service.
  • 25-50, 32K 340W Pressure Tanks needed off of NS or CSX in Marcellus for 1-2 Years. Cars are needed for use in Propane service.
  • 25-50, 30K DOT 111, 117, CPC 1232 Tanks needed off of CN or CP in WI, Sarnia for 1-2 Years. Cars are needed for use in Diesel service.
  • 10, 286K 15.7K Tanks needed off of KCS in Texas for 1 Year. Cars are needed for use in Sulfuric Acid service. Needed Next few months
  • 150, 23.5K DOT 111 Tanks needed off of any class 1 in LA for 2-3 Year. Cars are needed for use in Fluid service. Needed July
  • 100, 33K 340W Pressure Tanks needed off of CN in Canada for 3-5 Years. Cars are needed for use in Propane service.
  • 30, 17K-20K 117J Tanks needed off of UP or BN in Midwest/West Coast for 3-5 Years. Cars are needed for use in Caustic service.
  • 45, 3000 cf PDs Hoppers needed off of any class 1 in Texas for 3 years. Cars are needed for use in Any service.
  • up to 50, 31.8K 117J, 117R, CPC 1232 Tanks needed off of any class 1 in Texas or Ohio for 1-3 years. Cars are needed for use in Diesel / Gasoline service.
  • 100, 30K 117J Tanks needed off of CN in Detroit for 1 Year. Cars are needed for use in Refined Fuel service.
  • 60-150, 30K 117J Tanks needed off of TYR, UP in Corpus Christi, TX for 1 year. Cars are needed for use in Diesel service.
  • 30-50, 33K 340W Pressure Tanks needed off of any class 1 in any location for 6-12 Months. Cars are needed for use in Propane service.
  • 15, 28.3K 117J Tanks needed off of any class 1 in any location for 3 year. Cars are needed for use in Glycerin & Palm Oil service.
  • 25-50, 25.5K 117J, 117R, CPC 1232 Tanks needed off of UP or BN in Texas for 1-2 Years. Cars are needed for use in Asphalt service.
  • 10, 33K 340W Pressure Tanks needed off of CN in LA for 1 Year. Cars are needed for use in Butane service.
  • 50-100, 4550 Covered Hoppers needed off of UP or BN in Texas for 5 Years. Cars are needed for use in Grain service.
  • 25-50, 33K 400W Pressure Tanks needed off of CN or CP in Canada for Short Term. Cars are needed for use in Propylene service.
  • 100, 28.3K DOT 111/117 Tanks needed off of UP or BN in Midwest/Texas for 5 Years. Cars are needed for use in Veg Oils / Biodiesel service. Need to be Unlined
  • 20-25, 30K 117 Tanks needed off of UP or BN in Illinois for 5 Years. Cars are needed for use in Ethanol service.
  • 10, 30K 117 Tanks needed off of NS or CSX in Marcellus for Trip Lease. Cars are needed for use in C5 service.
  • 25, 33K 340W Pressure Tanks needed off of UP or BN in Midwest for Oct-March. Cars are needed for use in Propane service.
  • 15, 30K 117 Tanks needed off of NS in SouthEast for 1 Year. Cars are needed for use in Diesel service.

Sales Bids

  • 1-2, Any DOT 111, 117, CPC 1232 Tanks needed off of any class 1 in Texas. Coiled and Insulated
  • 45, 3000 cf PD Hoppers needed off of any class 1 in Texas. Negotiable
  • 20-25, 25.5K 117, DOT-111, CPC 1232 Tanks needed off of UP or BN in Texas. Cars are needed for use in Veg Oil service. Coiled and insulated
  • 15, 30K 117, DOT-111, CPC 1232 Tanks needed off of UP or BN in Texas. Cars are needed for use in Veg Oil service.
  • 2-4, 28K DOT 111 Tanks needed off of BNSF Preferred in Minnesota. Cars are needed for use in Biodiesel service. Coiled and insulated
  • 100, Plate F Boxcars needed off of BN or UP in Texas.
  • 200+, 5000cf Covered Hoppers needed off of any class 1 in various locations.
  • 20-30, 3000 – 3300 PDs Hoppers needed off of BN or UP preferred in West. Cars are needed for use in Cement service. C612
  • 10, 2770 Mill Gondolas needed off of any class 1 in St. Louis. Cars are needed for use in Cement service.
  • 100, 15.7K DOT 111 Tanks needed off of CSX or NS in the east. Cars are needed for use in Molten Sulfur service.
  • 30, 17K-20K DOT 111 Tanks needed off of UP or BN in Texas. Cars are needed for use in UAN service.
  • 20, 2770 Mill Gondolas needed off of CSX in the northeast. Cars are needed for use in non-haz soil service. 52-60 ft
  • 10, 4000 Open Hoppers needed off of CSX in the northeast. Cars are needed for use in scrap metal service. Open top hopper
  • 10, 6400 Open Hoppers needed off of CSX in the northeast. Cars are needed for use in wood chip service. Open top hopper, flat bottom

Lease Offers

  • 70, 25.5K, 117J Tanks located off of UP in Texas. Cars are clean Call for more information
  • 30, 23.5K, DOT111 Tanks located off of UP or BN in Texas. Cars were last used in Clean / UAN.
  • 25-100, 17.6K, DOT111 Tanks located off of UP or BN in Midwest. Cars were last used in Fertilizer / Corn Syurp. Free move available
  • 20, 20k, DOT111 Tanks located off of CSX in GA. Cars are clean
  • 2, 20K, DOT111 Tanks located off of UP in TX. Cars are clean
  • 5, 20K, DOT111 Tanks located off of UP in TX. Cars were last used in Sulfuirc Acid. Free move available
  • 108, 28.3K, 117R Tanks located off of All Class 1’s in St. Louis. Cars are clean
  • 10, 6500, Covered Hoppers located off of UP and BN in Iowa. Cars are clean
  • 5, 6300, Covered Hoppers located off of in Across US.

Sales Offers

  • 100-200, 31.8K, CPC 1232 Tanks located off of BN in Chicago. Dirty/Clean
  • 100, 28.3K, 117J Tanks located off of various class 1s in multiple locations.
  • 110, 25.5K, DOT 111 Tanks located off of UP and BN in multiple locations. Dirty, Food Grade. Cars are currently moving

Call PFL today to discuss your needs and our availability and market reach. Whether you are looking to lease cars, lease out cars, buy cars, or sell cars call PFL today at 239-390-2885

PFL offers turn-key solutions to maximize your profitability. Our goal is to provide a win/win scenario for all and we can handle virtually all of your railcar needs. Whether it’s loaded storage, empty storage, subleasing or leasing excess cars, filling orders for cars wanted, mobile railcar cleaning, blasting, mobile railcar repair, or scrapping at strategic partner sites, PFL will do its best to assist you. PFL also assists fleets and lessors with leases and sales and offers Total Fleet Evaluation Services. We will analyze your current leases, storage, and company objectives to draw up a plan of action. We will save Lessor and Lessee the headache and aggravation of navigating through this rapidly changing landscape.

PFL IS READY TO CLEAN CARS TODAY ON A MOBILE BASIS WE ARE CURRENTLY IN EAST TEXAS

Live Railcar Markets

Lease Offers
Lease Bids
Sales Offers
Sales Bids
CAT Type Capacity GRL QTY LOC Class Prev. Use Clean Offer Note