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Canadian Carrier Titanium Sees Upside To Coronavirus – For Now

A major Canadian trucking and logistics company, Titanium Transportation Group (TSX-V: TTR), reported on March 11 that the coronavirus outbreak has been good for business

Benzinga · 03/11/2020 18:07

A major Canadian trucking and logistics company, Titanium Transportation Group (TSX-V: TTR), reported on March 11 that the coronavirus outbreak has been good for business

"In the short-term, we're seeing the effects of coronavirus in a positive way," Chief Operating Officer Marlyn Daniel told analysts while discussing Titanium's fourth-quarter financial results.

Daniel did not elaborate on the impacts to Titanium's business. But her comments come amid an uptick in freight volumes in Canada and the U.S. that appear linked to the outbreak and panic-buying.

The Outbound Tender Volume Index for Canada on FreightWaves' SONAR platform has been moving up since March 1.

The Outbound Tender Volume Index for Canada (OTVI.CAN) on FreightWaves' SONAR platform has risen by more than 8% since March 1. While other factors such as the removal of blockades on Canadian National's rail network likely are at play, the increase in Canada mirrors similar activity in the United States.

In an interview with FreightWaves ahead of earnings, Daniel suggested that coronavirus represented both a risk and an opportunity, noting, "every grey area has a silver lining.

"We move a lot of paper. And for paper suppliers, coronavirus is not such a bad thing," Daniel said.

The panic-buying in Canada and the U.S. has included plenty of toilet paper and face masks. While that demand is good for the freight sector in the short term, the larger economic fallout is worrisome as disruptions from China give way to impacts closer to come. 

Prime Minister Justin Trudeau on Wednesday announced a C$1 billion fund to cushion the impact from coronavirus as federal leaders consider a larger stimulus package.

The Canadian government also has reduced wait times for unemployment insurance and is also leading an effort to buy some medical devices in bulk.

One encouraging sign – front-line health workers began testing for COVID-19 early on, in contrast to the U.S, which may help curb the extent of the outbreak. 

But for freight, the risks for supply chain disruptions remain high.

"I think we'll be seeing an impact as we start seeing more cancellations of major events and conventions," Steve Laskowski, president of the Canadian Trucking Alliance told FreightWaves. "If people aren't coming here, restaurants and service industries get hit and that affects trucking."

Those cancellations are mounting, most notably the Arctic Winter Games in the Yukon, which had been set for March 16. But another major event, the Juno Awards in Saskatoon, still is set for Sunday.

Trucking HR Canada, an organization devoted to transportation and logistics workplace issues, is moving ahead with events in Toronto on Wednesday and Thursday.

Angela Splinter, CEO of Trucking HR Canada, said the organization was watching coronavirus developments closely but did not see any immediate cause for cancellation. 

She noted that regardless of the coronavirus impact, freight continues to move.

"During an outbreak, people still need trucks to get the hand sanitizer," Splinter said.

Image by Renee Gaudet from Pixabay