Lessors report that where there is activity, it involves lessees moving out of the older 4,750 cubic foot cars with a flight to quality as they move up to larger capacity 286 jumbo covered hoppers.
Overall market slackness seems to have a variety underlying causes. Chicago Freight Car's Paul Deasy says that despite talk of the potential for record harvests, he is seeing limited shipper activity seeking to execute new grain car leases. He indicates that railroads are reporting that they can supply the cars that shippers will need for the coming harvest season.
Paul observes that most of the grain that moves by rail is corn, and that more corn has been moving by truck than had originally been expected. Paul also points out that railroad velocity has continued to improve and that increasing velocity and reduced transit times also reduces the total number of railcars needed to move any commodity.
What about exports?
There are reports that exports may increase to destinations like China, but that these moves may be met by railroad (particularly BNSF) supplied cars in unit trains moving grain to ports.