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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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Friday, 22 October 21
CHINA WANTS TO COOL COAL PRICES. SIMILAR MOVES FOR METALS, CRUDE FAILED - REUTERS
China’s latest attempt to lower runaway commodity prices, this time for thermal coal, is likely to follow a familiar pattern of initial succe ...
Friday, 22 October 21
HARD COAL REMAINS AN IMPORTANT FACTOR FOR SECURITY OF SUPPLY - COAL IMPORTERS ASSOCIATION, GERMANY
- Hard coal remains an important factor for security of supply
- Increase of around 35% in hard-coal-fired power generation in the first three ...
Wednesday, 20 October 21
CHINA'S COAL SHORTAGE TO EASE IN COMING MONTHS, INDUSTRY BODY SAYS - REUTERS
China’s coal shortage will likely ease in coming months, with domestic production and imports already showing signs of picking up, a coal ind ...
Wednesday, 20 October 21
CHINA'S RAW COAL OUTPUT DROPS IN SEPTEMBER - XINHUA
China’s raw coal output dropped 0.9 percent year on year to 330 million tonnes last month, data from the National Bureau of Statistics (NBS) ...
Wednesday, 20 October 21
OVER-RELIANCE ON COAL IN OUR POWER MIX HURTING INDIA - LIVEMINT
In spite of the renewables push, coal still accounts for about 50% of India’s installed power capacity. That means a simultaneous demand and ...
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- Uttam Galva Steels Limited - India
- Barasentosa Lestari - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- GVK Power & Infra Limited - India
- Ceylon Electricity Board - Sri Lanka
- Grasim Industreis Ltd - India
- Coal and Oil Company - UAE
- Semirara Mining Corp, Philippines
- PNOC Exploration Corporation - Philippines
- Simpson Spence & Young - Indonesia
- Energy Development Corp, Philippines
- Holcim Trading Pte Ltd - Singapore
- Altura Mining Limited, Indonesia
- Ministry of Transport, Egypt
- Cigading International Bulk Terminal - Indonesia
- Goldman Sachs - Singapore
- Mintek Dendrill Indonesia
- Karbindo Abesyapradhi - Indoneisa
- VISA Power Limited - India
- Kideco Jaya Agung - Indonesia
- Indian Oil Corporation Limited
- Meenaskhi Energy Private Limited - India
- Chettinad Cement Corporation Ltd - India
- Wilmar Investment Holdings
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Medco Energi Mining Internasional
- Alfred C Toepfer International GmbH - Germany
- Georgia Ports Authority, United States
- Larsen & Toubro Limited - India
- Salva Resources Pvt Ltd - India
- Parliament of New Zealand
- LBH Netherlands Bv - Netherlands
- Makarim & Taira - Indonesia
- Africa Commodities Group - South Africa
- International Coal Ventures Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Standard Chartered Bank - UAE
- Chamber of Mines of South Africa
- Mjunction Services Limited - India
- Ministry of Mines - Canada
- Bahari Cakrawala Sebuku - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Indika Energy - Indonesia
- Independent Power Producers Association of India
- Bayan Resources Tbk. - Indonesia
- Interocean Group of Companies - India
- Bhatia International Limited - India
- South Luzon Thermal Energy Corporation
- Heidelberg Cement - Germany
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Indonesian Coal Mining Association
- Gujarat Sidhee Cement - India
- Vijayanagar Sugar Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Central Electricity Authority - India
- Eastern Coal Council - USA
- Coalindo Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- Directorate General of MIneral and Coal - Indonesia
- London Commodity Brokers - England
- McConnell Dowell - Australia
- Global Green Power PLC Corporation, Philippines
- Coastal Gujarat Power Limited - India
- Leighton Contractors Pty Ltd - Australia
- Australian Commodity Traders Exchange
- Krishnapatnam Port Company Ltd. - India
- SMC Global Power, Philippines
- Gujarat Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Singapore Mercantile Exchange
- Mercuria Energy - Indonesia
- Jindal Steel & Power Ltd - India
- PowerSource Philippines DevCo
- Economic Council, Georgia
- Bangladesh Power Developement Board
- White Energy Company Limited
- Australian Coal Association
- Indogreen Group - Indonesia
- Agrawal Coal Company - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Malabar Cements Ltd - India
- Orica Australia Pty. Ltd.
- AsiaOL BioFuels Corp., Philippines
- Aditya Birla Group - India
- Aboitiz Power Corporation - Philippines
- Minerals Council of Australia
- Sakthi Sugars Limited - India
- Antam Resourcindo - Indonesia
- Indian Energy Exchange, India
- Siam City Cement - Thailand
- Latin American Coal - Colombia
- Power Finance Corporation Ltd., India
- Global Business Power Corporation, Philippines
- Marubeni Corporation - India
- Sical Logistics Limited - India
- Tamil Nadu electricity Board
- Meralco Power Generation, Philippines
- Sarangani Energy Corporation, Philippines
- Wood Mackenzie - Singapore
- Globalindo Alam Lestari - Indonesia
- Orica Mining Services - Indonesia
- Ind-Barath Power Infra Limited - India
- Bhoruka Overseas - Indonesia
- Petron Corporation, Philippines
- Eastern Energy - Thailand
- Straits Asia Resources Limited - Singapore
- GMR Energy Limited - India
- Oldendorff Carriers - Singapore
- Timah Investasi Mineral - Indoneisa
- The University of Queensland
- Bank of Tokyo Mitsubishi UFJ Ltd
- Attock Cement Pakistan Limited
- Rashtriya Ispat Nigam Limited - India
- Deloitte Consulting - India
- Port Waratah Coal Services - Australia
- Posco Energy - South Korea
- Cement Manufacturers Association - India
- IEA Clean Coal Centre - UK
- Binh Thuan Hamico - Vietnam
- Iligan Light & Power Inc, Philippines
- Romanian Commodities Exchange
- Toyota Tsusho Corporation, Japan
- Vedanta Resources Plc - India
- Directorate Of Revenue Intelligence - India
- Dalmia Cement Bharat India
- Vizag Seaport Private Limited - India
- OPG Power Generation Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Bharathi Cement Corporation - India
- Renaissance Capital - South Africa
- Electricity Generating Authority of Thailand
- Edison Trading Spa - Italy
- Kalimantan Lumbung Energi - Indonesia
- CNBM International Corporation - China
- Baramulti Group, Indonesia
- ASAPP Information Group - India
- Manunggal Multi Energi - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bulk Trading Sa - Switzerland
- Planning Commission, India
- Neyveli Lignite Corporation Ltd, - India
- Thiess Contractors Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Borneo Indobara - Indonesia
- Kumho Petrochemical, South Korea
- Siam City Cement PLC, Thailand
- SN Aboitiz Power Inc, Philippines
- Price Waterhouse Coopers - Russia
- Sojitz Corporation - Japan
- TeaM Sual Corporation - Philippines
- Energy Link Ltd, New Zealand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Makmur.PT - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Carbofer General Trading SA - India
- GN Power Mariveles Coal Plant, Philippines
- Trasteel International SA, Italy
- Savvy Resources Ltd - HongKong
- Ambuja Cements Ltd - India
- Jaiprakash Power Ventures ltd
- Intertek Mineral Services - Indonesia
- Kepco SPC Power Corporation, Philippines
- Electricity Authority, New Zealand
- SMG Consultants - Indonesia
- Parry Sugars Refinery, India
- Riau Bara Harum - Indonesia
- PTC India Limited - India
- Sinarmas Energy and Mining - Indonesia
- Bhushan Steel Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Star Paper Mills Limited - India
- Sree Jayajothi Cements Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Karaikal Port Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Thai Mozambique Logistica
- ICICI Bank Limited - India
- Bukit Baiduri Energy - Indonesia
- Lanco Infratech Ltd - India
- IHS Mccloskey Coal Group - USA
- Gujarat Mineral Development Corp Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Anglo American - United Kingdom
- Commonwealth Bank - Australia
- European Bulk Services B.V. - Netherlands
- Formosa Plastics Group - Taiwan
- Indo Tambangraya Megah - Indonesia
- MS Steel International - UAE
- Sindya Power Generating Company Private Ltd
- Tata Chemicals Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Essar Steel Hazira Ltd - India
- Ministry of Finance - Indonesia
- Banpu Public Company Limited - Thailand
- Kaltim Prima Coal - Indonesia
- Kartika Selabumi Mining - Indonesia
- Xindia Steels Limited - India
- The Treasury - Australian Government
- New Zealand Coal & Carbon
- GAC Shipping (India) Pvt Ltd
- Billiton Holdings Pty Ltd - Australia
- Central Java Power - Indonesia
- The State Trading Corporation of India Ltd
- Mercator Lines Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Global Coal Blending Company Limited - Australia
- Videocon Industries ltd - India
- Metalloyd Limited - United Kingdom
- Pendopo Energi Batubara - Indonesia
- Madhucon Powers Ltd - India
- San Jose City I Power Corp, Philippines
- India Bulls Power Limited - India
- CIMB Investment Bank - Malaysia
- Rio Tinto Coal - Australia
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