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EFTA01415820 | EFTA01415975 volumes (0.2% CAGR) fell off in 2016 (-6.4% yoy) amidst reduced oil and gas activity. Things have turned around in 2017, however, with petroleum and chemicals carloads up roughly 5% YTD (through 3Q). We see long-term tailwinds for chemical carload growth at CNI due to the over supply of polyethelene coming out of the Gulf which is where the majority of CNI's petroleum and chemical carloads originate. We note that chemical producers have commissioned facility investments that are expected to result in a 35% increase in polyethelene capacity by 2020 and +50% by 2025. This increase in supply is likely to far exceed domestic demand growth, resulting in export opportunities for railroads serving the area. Given CNI's connection to west coast ports, we see them as one of the beneficiaries of this trend as they provide an outlet for excess polyethelene to be exported to Asia. Deutsche Bank Securities Inc. Page 59 EFTA01415975
February 20, 2026 at 4:42 AM