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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, 13 October 21
FBX INDEX: THE IMPOSSIBILITY OF SHORT-TERM FORECASTING - LARS JENSEN
Will freight rates on Asia-Europe or the Transpacific reach 40.000 USD/FFE in the run-up prior to Chinese New Year 2022? Or will they start droppin ...
Wednesday, 13 October 21
CHINA FLOODS: COAL PRICE HITS FRESH HIGH AS MINES SHUT - BBC
The price of coal used in China’s power plants has surged to a new record high as another of the country’s key mining regions is hit by ...
Tuesday, 12 October 21
BUMA SIGNS CONDITIONAL AGREEMENT FOR AUSTRALIAN ASSET ACQUISITION
PT Tbk. announced that its subsidiary, PT Bukit Makmur Mandiri Utama, through its newly incorporated Australian subsidiary, BUMA International Pty ...
Tuesday, 12 October 21
INDONESIA'S COAL-BASED POWER PLANTS ARE SUBJECT TO CARBON TAX NEXT YEAR, ELECTRICITY COSTS COULD RISE! - CNBC
The Indonesian government is planning plans to implement a carbon tax of IDR 30 per kilogram (kg) of carbon dioxide equivalent (CO2e) or equivalent ...
Monday, 11 October 21
COAL ABANDONMENT IN POWER GENERATION PROMOTED GAS DEMAND GROWTH IN EUROPE - TOP MANAGER: TASS
Accelerated abandonment of coal in power generation and the overall recovery of economic activity facilitated gas demand growth in Europe and led t ...
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- Indian Oil Corporation Limited
- Semirara Mining Corp, Philippines
- Indo Tambangraya Megah - Indonesia
- Oldendorff Carriers - Singapore
- Neyveli Lignite Corporation Ltd, - India
- Latin American Coal - Colombia
- White Energy Company Limited
- Central Java Power - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Eastern Coal Council - USA
- Star Paper Mills Limited - India
- Electricity Authority, New Zealand
- Formosa Plastics Group - Taiwan
- PTC India Limited - India
- The Treasury - Australian Government
- Barasentosa Lestari - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Manunggal Multi Energi - Indonesia
- Iligan Light & Power Inc, Philippines
- Indogreen Group - Indonesia
- Tamil Nadu electricity Board
- Jindal Steel & Power Ltd - India
- Kaltim Prima Coal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Ambuja Cements Ltd - India
- Interocean Group of Companies - India
- Siam City Cement PLC, Thailand
- San Jose City I Power Corp, Philippines
- GVK Power & Infra Limited - India
- McConnell Dowell - Australia
- Sarangani Energy Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Grasim Industreis Ltd - India
- Chettinad Cement Corporation Ltd - India
- GAC Shipping (India) Pvt Ltd
- Timah Investasi Mineral - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Baramulti Group, Indonesia
- Aditya Birla Group - India
- Jaiprakash Power Ventures ltd
- Bayan Resources Tbk. - Indonesia
- Heidelberg Cement - Germany
- Indika Energy - Indonesia
- Agrawal Coal Company - India
- Romanian Commodities Exchange
- Ceylon Electricity Board - Sri Lanka
- Videocon Industries ltd - India
- Vedanta Resources Plc - India
- Carbofer General Trading SA - India
- Billiton Holdings Pty Ltd - Australia
- Parry Sugars Refinery, India
- TNB Fuel Sdn Bhd - Malaysia
- PNOC Exploration Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indonesian Coal Mining Association
- Chamber of Mines of South Africa
- SMC Global Power, Philippines
- Indian Energy Exchange, India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- IHS Mccloskey Coal Group - USA
- Australian Commodity Traders Exchange
- Kepco SPC Power Corporation, Philippines
- Vizag Seaport Private Limited - India
- Attock Cement Pakistan Limited
- Central Electricity Authority - India
- Kartika Selabumi Mining - Indonesia
- TeaM Sual Corporation - Philippines
- Trasteel International SA, Italy
- Lanco Infratech Ltd - India
- The University of Queensland
- Eastern Energy - Thailand
- Goldman Sachs - Singapore
- Leighton Contractors Pty Ltd - Australia
- Toyota Tsusho Corporation, Japan
- Dalmia Cement Bharat India
- Coal and Oil Company - UAE
- LBH Netherlands Bv - Netherlands
- Anglo American - United Kingdom
- Coastal Gujarat Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Commonwealth Bank - Australia
- Orica Australia Pty. Ltd.
- Binh Thuan Hamico - Vietnam
- Sree Jayajothi Cements Limited - India
- Meralco Power Generation, Philippines
- Madhucon Powers Ltd - India
- Marubeni Corporation - India
- Maheswari Brothers Coal Limited - India
- Ministry of Transport, Egypt
- Edison Trading Spa - Italy
- VISA Power Limited - India
- Sakthi Sugars Limited - India
- CIMB Investment Bank - Malaysia
- Makarim & Taira - Indonesia
- PowerSource Philippines DevCo
- India Bulls Power Limited - India
- Rashtriya Ispat Nigam Limited - India
- Simpson Spence & Young - Indonesia
- Borneo Indobara - Indonesia
- Sical Logistics Limited - India
- Bukit Makmur.PT - Indonesia
- Australian Coal Association
- Coalindo Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- Parliament of New Zealand
- Larsen & Toubro Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Therma Luzon, Inc, Philippines
- Electricity Generating Authority of Thailand
- ASAPP Information Group - India
- Mercator Lines Limited - India
- Bhushan Steel Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- South Luzon Thermal Energy Corporation
- New Zealand Coal & Carbon
- Riau Bara Harum - Indonesia
- Standard Chartered Bank - UAE
- Port Waratah Coal Services - Australia
- The State Trading Corporation of India Ltd
- Jorong Barutama Greston.PT - Indonesia
- Intertek Mineral Services - Indonesia
- Salva Resources Pvt Ltd - India
- Economic Council, Georgia
- Kumho Petrochemical, South Korea
- Bahari Cakrawala Sebuku - Indonesia
- Essar Steel Hazira Ltd - India
- Directorate Of Revenue Intelligence - India
- Bukit Baiduri Energy - Indonesia
- Thiess Contractors Indonesia
- AsiaOL BioFuels Corp., Philippines
- Ministry of Mines - Canada
- London Commodity Brokers - England
- Siam City Cement - Thailand
- Gujarat Sidhee Cement - India
- Altura Mining Limited, Indonesia
- Holcim Trading Pte Ltd - Singapore
- Cigading International Bulk Terminal - Indonesia
- Planning Commission, India
- Global Green Power PLC Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bukit Asam (Persero) Tbk - Indonesia
- Samtan Co., Ltd - South Korea
- Mercuria Energy - Indonesia
- Wilmar Investment Holdings
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ministry of Finance - Indonesia
- Global Coal Blending Company Limited - Australia
- Directorate General of MIneral and Coal - Indonesia
- Singapore Mercantile Exchange
- Miang Besar Coal Terminal - Indonesia
- Power Finance Corporation Ltd., India
- Sinarmas Energy and Mining - Indonesia
- OPG Power Generation Pvt Ltd - India
- Orica Mining Services - Indonesia
- Thai Mozambique Logistica
- Meenaskhi Energy Private Limited - India
- Price Waterhouse Coopers - Russia
- Merrill Lynch Commodities Europe
- Asmin Koalindo Tuhup - Indonesia
- Energy Development Corp, Philippines
- Petron Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Bangladesh Power Developement Board
- Vijayanagar Sugar Pvt Ltd - India
- Posco Energy - South Korea
- Bulk Trading Sa - Switzerland
- Pendopo Energi Batubara - Indonesia
- Bharathi Cement Corporation - India
- International Coal Ventures Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- Wood Mackenzie - Singapore
- CNBM International Corporation - China
- Sojitz Corporation - Japan
- Bhoruka Overseas - Indonesia
- SN Aboitiz Power Inc, Philippines
- Independent Power Producers Association of India
- Savvy Resources Ltd - HongKong
- Global Business Power Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- MS Steel International - UAE
- Karbindo Abesyapradhi - Indoneisa
- Tata Chemicals Ltd - India
- SMG Consultants - Indonesia
- Malabar Cements Ltd - India
- Straits Asia Resources Limited - Singapore
- Bhatia International Limited - India
- Renaissance Capital - South Africa
- Semirara Mining and Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Ind-Barath Power Infra Limited - India
- Mjunction Services Limited - India
- ICICI Bank Limited - India
- Metalloyd Limited - United Kingdom
- Globalindo Alam Lestari - Indonesia
- Kideco Jaya Agung - Indonesia
- GMR Energy Limited - India
- Georgia Ports Authority, United States
- Medco Energi Mining Internasional
- Antam Resourcindo - Indonesia
- Karaikal Port Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Sindya Power Generating Company Private Ltd
- Uttam Galva Steels Limited - India
- Rio Tinto Coal - Australia
- Energy Link Ltd, New Zealand
- IEA Clean Coal Centre - UK
- Africa Commodities Group - South Africa
- Mintek Dendrill Indonesia
- Deloitte Consulting - India
- Cement Manufacturers Association - India
- Minerals Council of Australia
- Xindia Steels Limited - India
- Kobexindo Tractors - Indoneisa
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