Montana railroads aren't panicked over nationwide freight recession

[mahatmakanejeeves]

nationwide freight recession

Montana railroads aren't panicked over nationwide freight recession

KIM BRIGGEMAN [e-mail] Updated 41 min ago

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Montana Rail Link is a short-line railroad headquartered in Missoula and owned by billionaire Dennis Washington’s Washington Companies. Texas-based BNSF, one of the nation’s “Big 4” railroads, is wholly owned by Warren Buffett’s Berkshire Hathaway Inc., which bought it for $44 billion in 2010. ... Though neither claims to be in crisis mode, both are feeling the pinch of a freight recession that’s battering the rail industry.

The Bakken oil boom has busted. Even as the Obama administration imposes a moratorium on new coal leases on federal lands – a move already being challenged in Montana and elsewhere – overseas markets for coal from southeast Montana and Wyoming are turning to dust. China alone reduced coal imports by 30 percent last year.

Nationwide, coal shipped by rail was down by nearly 700,000 carloads in 2015 – a decline of 12 percent from 2014. And it’s only going to get worse in 2016.
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The 2015 numbers are startling.

The Association of American Railroads (AAR) said this month that freight rail traffic in the U.S. in 2015 was down more than 900,000 carloads – 6.1 percent – from the year before. In the first three weeks of 2016 it’s dropped 16.6 percent compared to the same three weeks in 2015.

[elleng]

1. Thanks for the memories!

'“MRL is accustomed to the peaks and valleys of the U.S. and global economy,” Lewis said. “Although the current economic environment will certainly be a challenge for us, and some changes will likely be necessary to adjust to current freight volume levels, we will continue to be focused on safety, efficiency and providing the best rail service in the industry.”

Lewis is not alarmed about plummeting costs and government incentives for wind and solar production.

“We value the global and local environment in which our employees live, work and play,” he said. “MRL hauls many different commodities, including wind power towers/blades and other products related to renewable energies and recyclables.”

Typically, when volumes of one commodity shrink, growth occurs in another sector.

“MRL stands ready to haul whatever commodity groups are in demand,” Lewis said.

The great stabilizer, de Yong said, is agriculture.

“The railroads got started with agricultural commodities, and at the end of the day there are going to be agricultural commodities again,” he said. “That’s what built the railroads.”'




After I left ICC/STB, I worked for a firm representing MRL, and went west with family for vacation, visiting MRL during the trip.