This article is taken from the November 9, 2023 USDA Grain Transportation Report.

Roughly three-quarters of U.S. railcars are not owned by the railroads. Some are owned by shippers themselves, but a large portion are owned by companies that lease railcars to shippers.

Beginning on page 9 of the October 2023 issue of Railway Age, industry expert David Nahass discusses the state of the railcar leasing industry. He notes that, partly because the current railcar leasing supply has not expanded to meet rising demand, high rates persist.

Supply is especially “inelastic” in the market for covered hoppers, primarily used for grain. Nahass notes that the current per month rates to lease large grain cars (C-114) for 5-to-7-year terms are in the low $600s, which is higher than in early 2020 when rates were around $400 per month.

That change could be due to there being fewer cars today, as well as higher interest rates and poorer rail service