Despite setbacks related to the pandemic, the transport of cargo by rail remains a sizeable industry. In 2020, the global rail freight boasted a market size of just under 247.4 billion U.S. dollars, which is projected to steadily increase to around 278.6 billion U.S. dollars by 2026. Railway businesses consistently rank amongst the leading freight transportation companies, with the China State Railway Corporation recorded as the third major freight company worldwide as of 2020. Russian Railways and North American Class I railways also made the ranking.
Rail freight worldwide
Rail freight transport is a dominant issue worldwide. Throughout North and South America, some 2.5 trillion tonne-kilometers of freight cargo were hauled by rail as of 2019. Rail freight is used to haul a wide variety of goods across the region, with coal, chemicals, and nonmetallic minerals being the most widely transported in 2020. In July 2021, President Joe Biden issued an executive order targeted at inhibiting anti-competitive behaviors in an effort to improve consumer costs and promote competitiveness within the industry. This resulted in a drop of more than six percent in the stocks of CSX Corporation, Kansas City Southern, and Norfolk Southern—railroads with activities spanning the North American region.In South America, Brazil was set to introduce one of the largest rail infrastructure projects in the world. The Chinese-funded Pará railway project sought to construct a rail network spanning roughly 1,312 kilometers from Santana do Araguaia to Barcarena in order to boost significant growth in Brazil’s rail freight industry—particularly through the transport of iron core.
Although the United States recorded the largest railroad network worldwide in 2019, Asia-Oceania was the region transporting the most cargo by rail. At just under 3.47 billion tonne-kilometers hauled in 2019, the region was followed closely only by Europe. The Asia-Oceania region is also home to the majority of large-scale rail infrastructure projects to be launched by 2022, including the high-speed route Delhi-Chennai in India and the Haolebaoji-Jian line in China.
The increasing focus on rail freight
The year 2021 recorded the unveiling of the world’s first all battery-electric freight locomotive, introduced by Wabtec in September of that year. Rail freight is also one of the modes of freight transport with the lowest to greenhouse gas emissions. In Europe, in 2018, this amounted to 24 grams of carbon dioxide per tonne-kilometer. Comparatively, heavy goods vehicles reported emissions fivefold greater than rail freight. On a global scale, rail transport—including both passenger and freight rail operations—accounted for only three percent of the total CO2 emissions produced by the transportation sector in 2020.Despite these environmental advantages, rail freight demand varied vastly across the globe. The European Union (EU-25) recorded the lowest demand worldwide in 2019, despite boasting a large railway network. This was in part due to the popularity of road and maritime freight transport throughout the region. The COVID-19 pandemic further impacted rail freight demand, as the rail industry reached a standstill due to national restrictive measures.
