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Saturday, 16 October 21
DESPITE HIGHER COAL PRICES, U.S. COAL RECOVERY LOOKS WEAK BY MOST MEASURES - IEEFA
 U.S. coal sector is locked into a long-term sectoral decline
Coal prices have surged to the highest level in years in the U.S., and have soared in international markets. These high prices should significantly boost revenues and profits at coal mining companies—a remarkable turnaround from just a year ago, when the world’s pandemic-induced economic swoon sent export prices and demand tumbling.
Yet by most measures—including coal production, consumption for electric power, mining jobs and coming coal-plant retirements—the sector will barely rebound to 2019 levels, a far more telling comparison than to 2020, the worst year for U.S. coal in decades.
U.S. coal production
Take U.S. coal production, the broadest measure of the industry’s condition. This year’s output is expected to be 588 million tons, up 10% from 2020’s 535 million tons, according to October’s Short-Term Energy Outlook from the Energy Information Administration. That seems like a decent rebound, but it’s actually 118 million tons lower than in 2019, and, other than 2020, would be the lowest since 1971.
Coal use for electric power
Coal use for electric power is up over last year, too. The EIA’s latest outlook expects an 84-million-ton, or 19%, increase, to 521 million tons, compared with the 437 million tons used in 2020. Once again, this appears to be a substantial recovery—except that it’s lower than 2019’s 539 million tons. This is significant because more than 90% of the coal consumed in the U.S. is used to generate electricity.
This poor recovery in coal use looks even worse considering the price of natural gas rose 83% from $2.47 per thousand cubic feet in the third quarter of 2019 to $4.53 in the third quarter of this year. And, as IEEFA has noted about the energy transition in U.S. electricity markets, coal and gas together have not gained market share, and are instead continuing to lose ground to renewables. This is a trend that will continue for the foreseeable future, given the ongoing construction boom in utility-scale solar and wind. If anything, high prices for coal and gas, if sustained, are likely to cause the switch to renewables to accelerate.
Coal’s domestic market continues to shrink, too. More than 80GW of coal-plant retirements—more than one-third of the current operating capacity—are already scheduled to be retired by the end of 2030. IEEFA estimates these units used 166 million tons of coal in 2019, which would cut demand to about 375 million tons by the end of the decade, and this does not account for any new retirement announcements that could be made. On top of this, the remaining coal plants are likely to run less and less. EIA data shows the capacity factor for coal plants (a measure of how much of their generating potential is actually used) fell from 62.8% in 2011 to just 40.2% in 2020. IEEFA estimates that even a modest decline in capacity factors at the plants expected to operate after 2030 could result in a further loss of more than 80 million tons, bringing the total drop in coal demand from the U.S. power sector to about 250 million tons. In other words, coal’s largest U.S. market could shrink as much as 50% in just nine years.
U.S. coal mining jobs continue to decline
Another sign that coal mining isn’t recovering is the scale and timing of job losses. Nearly 24,000 jobs have been cut—a 29% decline—since 2019, when an average of 81,478 people were working for either coal-mine operators or contractors. This includes a loss of more than 6,100 jobs between 2020 and the first half of 2021, according to the latest figures from the Mine Safety and Health Administration, leaving just 57,497 workers in coal mining. That’s just half the number employed as recently as 2014.
Exports
With surging prices for coal in international markets—a complete turnaround from a year ago—coal exports should be a bright spot for American producers. No doubt for the companies that are exporting, there will be a significant boost to their bottom lines, because volumes are set to grow by 34% this year compared with 2020, to 92.6 million tons. Yet even here, this only returns exports to the 2019 level of 93.8 million tons, and the EIA outlook sees almost no further growth in 2022, when it expects 94.8 million tons to be sold abroad.
It is not surprising that coal has staged at least some comeback over 2020—by many measures the worst year for the industry in decades. What is surprising is that the rebound has fallen short of even 2019 in the critical measures of production, consumption by the power sector and jobs. This year’s high coal prices are likely to improve the weak finances at many mining companies, at least temporarily, but they won’t change the sector’s long-term decline. If anything, the high cost of coal is making the economics of switching to lower-cost renewables and storage even more compelling, and could result in utilities and other power producers accelerating their shift away from using coal.
By Seth Feaster
Data Analyst
IEEFA Energy
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Wednesday, 01 December 21
SUPPLY OF COAL TO POWER PLANTS IN NOV MORE THAN CONSUMPTION: JOSHI - PTI
The supply of coal to power plants in November is more than the consumption, resulting in rise in stock of dry fuel at power plants, and this trend ...
Wednesday, 01 December 21
MARKET INSIGHT - INTERMODAL
Essentially, anyone involved in the shipping and commodity markets still struggle with commodity supply issues and skyrocketing prices in the conte ...
Tuesday, 30 November 21
CHINA'S TOP ECONOMIC PLANNER SUMMONS COAL PRODUCERS; LONG-TERM PRICING MECHANISM IS ADVISED - GLOBAL TIMES
China’s top economic planner the National Development and Reform Commission (NDRC) said on Monday that they summoned coal producers for a hea ...
Tuesday, 30 November 21
CHINA'S COAL PRICES PLUNGE AFTER GOVT SIGNALS MORE PRICE REGULATION - REUTERS
China’s thermal coal futures dropped 5.6% on Monday after the state economic planner signaled further regulations for prices of the dirty pow ...
Friday, 26 November 21
AS COAL MARKET STABILIZES, CHINA STEPS UP NATURAL GAS SUPPLY TO MEET WINTER DEMAND - GLOBAL TIMES
The daily supply of natural gas in China has exceeded 1 billion cubic meters (bcm) since November began, up 11 percent year-on-year, data from stat ...
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- Deloitte Consulting - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mintek Dendrill Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Chettinad Cement Corporation Ltd - India
- Vizag Seaport Private Limited - India
- Sakthi Sugars Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ministry of Mines - Canada
- European Bulk Services B.V. - Netherlands
- Samtan Co., Ltd - South Korea
- Bayan Resources Tbk. - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Therma Luzon, Inc, Philippines
- Bulk Trading Sa - Switzerland
- Barasentosa Lestari - Indonesia
- Aboitiz Power Corporation - Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indonesian Coal Mining Association
- McConnell Dowell - Australia
- Coalindo Energy - Indonesia
- Orica Mining Services - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Edison Trading Spa - Italy
- Global Business Power Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- Standard Chartered Bank - UAE
- Parliament of New Zealand
- Videocon Industries ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Central Electricity Authority - India
- Marubeni Corporation - India
- Uttam Galva Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- Singapore Mercantile Exchange
- Alfred C Toepfer International GmbH - Germany
- Bharathi Cement Corporation - India
- White Energy Company Limited
- Krishnapatnam Port Company Ltd. - India
- Mercator Lines Limited - India
- Commonwealth Bank - Australia
- Riau Bara Harum - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PNOC Exploration Corporation - Philippines
- Orica Australia Pty. Ltd.
- Bahari Cakrawala Sebuku - Indonesia
- Energy Link Ltd, New Zealand
- Billiton Holdings Pty Ltd - Australia
- CNBM International Corporation - China
- Attock Cement Pakistan Limited
- Global Green Power PLC Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Sindya Power Generating Company Private Ltd
- Indian Energy Exchange, India
- Binh Thuan Hamico - Vietnam
- Directorate General of MIneral and Coal - Indonesia
- New Zealand Coal & Carbon
- ASAPP Information Group - India
- San Jose City I Power Corp, Philippines
- Posco Energy - South Korea
- Trasteel International SA, Italy
- Tata Chemicals Ltd - India
- Electricity Authority, New Zealand
- Intertek Mineral Services - Indonesia
- Semirara Mining Corp, Philippines
- IEA Clean Coal Centre - UK
- CIMB Investment Bank - Malaysia
- Mjunction Services Limited - India
- GMR Energy Limited - India
- Meenaskhi Energy Private Limited - India
- Ind-Barath Power Infra Limited - India
- Salva Resources Pvt Ltd - India
- Economic Council, Georgia
- Directorate Of Revenue Intelligence - India
- Wood Mackenzie - Singapore
- Parry Sugars Refinery, India
- Gujarat Sidhee Cement - India
- Malabar Cements Ltd - India
- SMC Global Power, Philippines
- Borneo Indobara - Indonesia
- Siam City Cement PLC, Thailand
- Mercuria Energy - Indonesia
- PTC India Limited - India
- LBH Netherlands Bv - Netherlands
- Ambuja Cements Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Central Java Power - Indonesia
- Coal and Oil Company - UAE
- Neyveli Lignite Corporation Ltd, - India
- Merrill Lynch Commodities Europe
- Ministry of Transport, Egypt
- Ministry of Finance - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Holcim Trading Pte Ltd - Singapore
- Petron Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- Bangladesh Power Developement Board
- Thiess Contractors Indonesia
- Energy Development Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- Madhucon Powers Ltd - India
- Meralco Power Generation, Philippines
- VISA Power Limited - India
- Bukit Makmur.PT - Indonesia
- Minerals Council of Australia
- Sree Jayajothi Cements Limited - India
- Altura Mining Limited, Indonesia
- Maheswari Brothers Coal Limited - India
- Kideco Jaya Agung - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Carbofer General Trading SA - India
- Metalloyd Limited - United Kingdom
- Independent Power Producers Association of India
- SN Aboitiz Power Inc, Philippines
- Medco Energi Mining Internasional
- Jaiprakash Power Ventures ltd
- Ceylon Electricity Board - Sri Lanka
- Maharashtra Electricity Regulatory Commission - India
- Coastal Gujarat Power Limited - India
- Bukit Baiduri Energy - Indonesia
- Georgia Ports Authority, United States
- Heidelberg Cement - Germany
- Eastern Coal Council - USA
- Romanian Commodities Exchange
- Kumho Petrochemical, South Korea
- Sinarmas Energy and Mining - Indonesia
- Xindia Steels Limited - India
- Rio Tinto Coal - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Interocean Group of Companies - India
- Indo Tambangraya Megah - Indonesia
- Pendopo Energi Batubara - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Rashtriya Ispat Nigam Limited - India
- Africa Commodities Group - South Africa
- Cement Manufacturers Association - India
- Siam City Cement - Thailand
- Savvy Resources Ltd - HongKong
- TNB Fuel Sdn Bhd - Malaysia
- Antam Resourcindo - Indonesia
- India Bulls Power Limited - India
- Electricity Generating Authority of Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Bhatia International Limited - India
- The Treasury - Australian Government
- IHS Mccloskey Coal Group - USA
- Vedanta Resources Plc - India
- Toyota Tsusho Corporation, Japan
- Simpson Spence & Young - Indonesia
- Dalmia Cement Bharat India
- Sarangani Energy Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Essar Steel Hazira Ltd - India
- Thai Mozambique Logistica
- International Coal Ventures Pvt Ltd - India
- PowerSource Philippines DevCo
- Wilmar Investment Holdings
- Banpu Public Company Limited - Thailand
- Indogreen Group - Indonesia
- ICICI Bank Limited - India
- GVK Power & Infra Limited - India
- Larsen & Toubro Limited - India
- Power Finance Corporation Ltd., India
- Manunggal Multi Energi - Indonesia
- Global Coal Blending Company Limited - Australia
- Tamil Nadu electricity Board
- Baramulti Group, Indonesia
- Aditya Birla Group - India
- The University of Queensland
- Eastern Energy - Thailand
- Bhushan Steel Limited - India
- Makarim & Taira - Indonesia
- Australian Commodity Traders Exchange
- Lanco Infratech Ltd - India
- Straits Asia Resources Limited - Singapore
- London Commodity Brokers - England
- Renaissance Capital - South Africa
- Leighton Contractors Pty Ltd - Australia
- Asmin Koalindo Tuhup - Indonesia
- Timah Investasi Mineral - Indoneisa
- Price Waterhouse Coopers - Russia
- SMG Consultants - Indonesia
- OPG Power Generation Pvt Ltd - India
- Star Paper Mills Limited - India
- Indian Oil Corporation Limited
- The State Trading Corporation of India Ltd
- Globalindo Alam Lestari - Indonesia
- Kartika Selabumi Mining - Indonesia
- MS Steel International - UAE
- Kalimantan Lumbung Energi - Indonesia
- Agrawal Coal Company - India
- Gujarat Electricity Regulatory Commission - India
- Iligan Light & Power Inc, Philippines
- Australian Coal Association
- Kobexindo Tractors - Indoneisa
- Port Waratah Coal Services - Australia
- Goldman Sachs - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Formosa Plastics Group - Taiwan
- Sojitz Corporation - Japan
- Indika Energy - Indonesia
- Latin American Coal - Colombia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sical Logistics Limited - India
- Planning Commission, India
- Grasim Industreis Ltd - India
- Chamber of Mines of South Africa
- Kapuas Tunggal Persada - Indonesia
- Oldendorff Carriers - Singapore
- GAC Shipping (India) Pvt Ltd
- Anglo American - United Kingdom
- Bhoruka Overseas - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Miang Besar Coal Terminal - Indonesia
- Kepco SPC Power Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- South Luzon Thermal Energy Corporation
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