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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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- Port Waratah Coal Services - Australia
- Parry Sugars Refinery, India
- Ministry of Transport, Egypt
- International Coal Ventures Pvt Ltd - India
- Kumho Petrochemical, South Korea
- Videocon Industries ltd - India
- Mercuria Energy - Indonesia
- India Bulls Power Limited - India
- Bharathi Cement Corporation - India
- Ceylon Electricity Board - Sri Lanka
- Indian Energy Exchange, India
- Deloitte Consulting - India
- PetroVietnam Power Coal Import and Supply Company
- Indika Energy - Indonesia
- Commonwealth Bank - Australia
- Interocean Group of Companies - India
- Latin American Coal - Colombia
- Sindya Power Generating Company Private Ltd
- Karbindo Abesyapradhi - Indoneisa
- Bangladesh Power Developement Board
- Vizag Seaport Private Limited - India
- Indogreen Group - Indonesia
- Semirara Mining Corp, Philippines
- Alfred C Toepfer International GmbH - Germany
- Manunggal Multi Energi - Indonesia
- Baramulti Group, Indonesia
- Australian Coal Association
- Planning Commission, India
- Marubeni Corporation - India
- Price Waterhouse Coopers - Russia
- SN Aboitiz Power Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Kepco SPC Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bukit Baiduri Energy - Indonesia
- Riau Bara Harum - Indonesia
- Kaltim Prima Coal - Indonesia
- Rio Tinto Coal - Australia
- Asmin Koalindo Tuhup - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Aditya Birla Group - India
- Pendopo Energi Batubara - Indonesia
- European Bulk Services B.V. - Netherlands
- Standard Chartered Bank - UAE
- Thiess Contractors Indonesia
- Star Paper Mills Limited - India
- Madhucon Powers Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Lanco Infratech Ltd - India
- OPG Power Generation Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- McConnell Dowell - Australia
- Kideco Jaya Agung - Indonesia
- Romanian Commodities Exchange
- VISA Power Limited - India
- Altura Mining Limited, Indonesia
- Wilmar Investment Holdings
- New Zealand Coal & Carbon
- Sinarmas Energy and Mining - Indonesia
- Billiton Holdings Pty Ltd - Australia
- IHS Mccloskey Coal Group - USA
- Bulk Trading Sa - Switzerland
- Medco Energi Mining Internasional
- Gujarat Sidhee Cement - India
- Maheswari Brothers Coal Limited - India
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- Uttam Galva Steels Limited - India
- Eastern Energy - Thailand
- Grasim Industreis Ltd - India
- SMC Global Power, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Siam City Cement - Thailand
- Independent Power Producers Association of India
- Jaiprakash Power Ventures ltd
- San Jose City I Power Corp, Philippines
- Mintek Dendrill Indonesia
- Coalindo Energy - Indonesia
- MS Steel International - UAE
- GN Power Mariveles Coal Plant, Philippines
- Directorate Of Revenue Intelligence - India
- Eastern Coal Council - USA
- Ind-Barath Power Infra Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Edison Trading Spa - Italy
- Globalindo Alam Lestari - Indonesia
- Binh Thuan Hamico - Vietnam
- GVK Power & Infra Limited - India
- Antam Resourcindo - Indonesia
- Savvy Resources Ltd - HongKong
- Central Java Power - Indonesia
- Metalloyd Limited - United Kingdom
- Xindia Steels Limited - India
- Heidelberg Cement - Germany
- Barasentosa Lestari - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- White Energy Company Limited
- Straits Asia Resources Limited - Singapore
- Power Finance Corporation Ltd., India
- Orica Mining Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- CNBM International Corporation - China
- Central Electricity Authority - India
- Banpu Public Company Limited - Thailand
- Australian Commodity Traders Exchange
- Indian Oil Corporation Limited
- Parliament of New Zealand
- Borneo Indobara - Indonesia
- Thai Mozambique Logistica
- Neyveli Lignite Corporation Ltd, - India
- Meenaskhi Energy Private Limited - India
- Bhoruka Overseas - Indonesia
- Sarangani Energy Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Cement Manufacturers Association - India
- AsiaOL BioFuels Corp., Philippines
- Georgia Ports Authority, United States
- GAC Shipping (India) Pvt Ltd
- GMR Energy Limited - India
- Orica Australia Pty. Ltd.
- Sree Jayajothi Cements Limited - India
- Anglo American - United Kingdom
- Karaikal Port Pvt Ltd - India
- Trasteel International SA, Italy
- Sakthi Sugars Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Energy Development Corp, Philippines
- Tata Chemicals Ltd - India
- London Commodity Brokers - England
- Sojitz Corporation - Japan
- Aboitiz Power Corporation - Philippines
- Intertek Mineral Services - Indonesia
- PNOC Exploration Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- CIMB Investment Bank - Malaysia
- Gujarat Mineral Development Corp Ltd - India
- The University of Queensland
- Coastal Gujarat Power Limited - India
- Agrawal Coal Company - India
- LBH Netherlands Bv - Netherlands
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- Dalmia Cement Bharat India
- ASAPP Information Group - India
- TNB Fuel Sdn Bhd - Malaysia
- Coal and Oil Company - UAE
- Rashtriya Ispat Nigam Limited - India
- Leighton Contractors Pty Ltd - Australia
- IEA Clean Coal Centre - UK
- Meralco Power Generation, Philippines
- The State Trading Corporation of India Ltd
- Bhushan Steel Limited - India
- Ambuja Cements Ltd - India
- Bayan Resources Tbk. - Indonesia
- Kobexindo Tractors - Indoneisa
- Indonesian Coal Mining Association
- Mercator Lines Limited - India
- Gujarat Electricity Regulatory Commission - India
- Carbofer General Trading SA - India
- Ministry of Finance - Indonesia
- Sical Logistics Limited - India
- PTC India Limited - India
- Therma Luzon, Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Siam City Cement PLC, Thailand
- Kartika Selabumi Mining - Indonesia
- Attock Cement Pakistan Limited
- TeaM Sual Corporation - Philippines
- Electricity Authority, New Zealand
- Singapore Mercantile Exchange
- Indo Tambangraya Megah - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Krishnapatnam Port Company Ltd. - India
- Essar Steel Hazira Ltd - India
- Africa Commodities Group - South Africa
- Chettinad Cement Corporation Ltd - India
- Mjunction Services Limited - India
- Larsen & Toubro Limited - India
- Timah Investasi Mineral - Indoneisa
- Posco Energy - South Korea
- Oldendorff Carriers - Singapore
- Chamber of Mines of South Africa
- Economic Council, Georgia
- Bukit Asam (Persero) Tbk - Indonesia
- Toyota Tsusho Corporation, Japan
- The Treasury - Australian Government
- PowerSource Philippines DevCo
- Semirara Mining and Power Corporation, Philippines
- Minerals Council of Australia
- Renaissance Capital - South Africa
- South Luzon Thermal Energy Corporation
- Simpson Spence & Young - Indonesia
- Malabar Cements Ltd - India
- Energy Link Ltd, New Zealand
- Tamil Nadu electricity Board
- Samtan Co., Ltd - South Korea
- Bhatia International Limited - India
- Wood Mackenzie - Singapore
- Makarim & Taira - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Merrill Lynch Commodities Europe
- Formosa Plastics Group - Taiwan
- Electricity Generating Authority of Thailand
- Global Business Power Corporation, Philippines
- Goldman Sachs - Singapore
- Salva Resources Pvt Ltd - India
- Petron Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Vedanta Resources Plc - India
- Global Coal Blending Company Limited - Australia
- Jindal Steel & Power Ltd - India
- ICICI Bank Limited - India
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