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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, 20 October 21
CHINA COAL HITS RECORD HIGH AMID TIGHT SUPPLIES - REUTERS
China coal prices hit a record high on Tuesday buoyed by a widening power crunch and cold weather despite Beijing’s efforts to bolster supply ...
Wednesday, 20 October 21
MARKET INSIGHT - INTERMODAL
IMO 2020, Ballast Water Treatment regulations, Green Recycling, GHG emissions, EEXI, CII, ETS, Fit for 55, Carbon price/levy, the Poseidon Principl ...
Tuesday, 19 October 21
SPONGE IRON SECTOR MIGHT REPORT NEGATIVE GROWTH DUE TO COAL CRISIS: SIMA - PTI
The domestic sponge iron industry might report a negative growth in the ongoing December quarter “if the shortage of coal is allowed to conti ...
Tuesday, 19 October 21
COAL INDIA, THE FALL GUY FOR POWER CRISIS - INDIA EXPRESS
The post-Covid economic recovery has led to a major increase in the demand for power, both in India and globally. In India, coal-based power plants ...
Saturday, 16 October 21
SOLAR INSTALLATION SURGE PUTS INDIA ON TRACK TO CAP COAL-FIRED POWER AS EARLY AS 2024 - IEEFA
Recent increase in solar power installations could push coal to peak sooner than expected
If India keeps installing solar capacity a ...
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- Ambuja Cements Ltd - India
- Ind-Barath Power Infra Limited - India
- Planning Commission, India
- London Commodity Brokers - England
- Formosa Plastics Group - Taiwan
- Carbofer General Trading SA - India
- Petrochimia International Co. Ltd.- Taiwan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Bukit Baiduri Energy - Indonesia
- Petron Corporation, Philippines
- Cement Manufacturers Association - India
- Vijayanagar Sugar Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Thiess Contractors Indonesia
- Bhoruka Overseas - Indonesia
- Wood Mackenzie - Singapore
- SN Aboitiz Power Inc, Philippines
- Sree Jayajothi Cements Limited - India
- Kideco Jaya Agung - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Kaltim Prima Coal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Makarim & Taira - Indonesia
- Pendopo Energi Batubara - Indonesia
- Ministry of Transport, Egypt
- Aboitiz Power Corporation - Philippines
- Simpson Spence & Young - Indonesia
- The University of Queensland
- The State Trading Corporation of India Ltd
- Singapore Mercantile Exchange
- Mintek Dendrill Indonesia
- SMC Global Power, Philippines
- Renaissance Capital - South Africa
- GVK Power & Infra Limited - India
- CIMB Investment Bank - Malaysia
- Mercuria Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Medco Energi Mining Internasional
- Kapuas Tunggal Persada - Indonesia
- Intertek Mineral Services - Indonesia
- Indian Oil Corporation Limited
- PetroVietnam Power Coal Import and Supply Company
- Manunggal Multi Energi - Indonesia
- LBH Netherlands Bv - Netherlands
- Sindya Power Generating Company Private Ltd
- Lanco Infratech Ltd - India
- Central Electricity Authority - India
- South Luzon Thermal Energy Corporation
- The Treasury - Australian Government
- Offshore Bulk Terminal Pte Ltd, Singapore
- Anglo American - United Kingdom
- Jorong Barutama Greston.PT - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- White Energy Company Limited
- Therma Luzon, Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- Madhucon Powers Ltd - India
- Orica Australia Pty. Ltd.
- TNB Fuel Sdn Bhd - Malaysia
- Standard Chartered Bank - UAE
- Oldendorff Carriers - Singapore
- Banpu Public Company Limited - Thailand
- Gujarat Sidhee Cement - India
- Billiton Holdings Pty Ltd - Australia
- Wilmar Investment Holdings
- Australian Commodity Traders Exchange
- Krishnapatnam Port Company Ltd. - India
- PNOC Exploration Corporation - Philippines
- Parry Sugars Refinery, India
- Eastern Energy - Thailand
- Deloitte Consulting - India
- Posco Energy - South Korea
- Mercator Lines Limited - India
- Eastern Coal Council - USA
- Interocean Group of Companies - India
- Grasim Industreis Ltd - India
- European Bulk Services B.V. - Netherlands
- Malabar Cements Ltd - India
- CNBM International Corporation - China
- Bayan Resources Tbk. - Indonesia
- Larsen & Toubro Limited - India
- SMG Consultants - Indonesia
- Baramulti Group, Indonesia
- Maheswari Brothers Coal Limited - India
- New Zealand Coal & Carbon
- Power Finance Corporation Ltd., India
- Coalindo Energy - Indonesia
- Videocon Industries ltd - India
- Australian Coal Association
- Bulk Trading Sa - Switzerland
- Economic Council, Georgia
- Holcim Trading Pte Ltd - Singapore
- Attock Cement Pakistan Limited
- Global Coal Blending Company Limited - Australia
- Vedanta Resources Plc - India
- Bharathi Cement Corporation - India
- Rio Tinto Coal - Australia
- IHS Mccloskey Coal Group - USA
- McConnell Dowell - Australia
- Bhatia International Limited - India
- Semirara Mining Corp, Philippines
- Sojitz Corporation - Japan
- Georgia Ports Authority, United States
- Iligan Light & Power Inc, Philippines
- Sarangani Energy Corporation, Philippines
- Salva Resources Pvt Ltd - India
- ASAPP Information Group - India
- Indogreen Group - Indonesia
- Tata Chemicals Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Global Green Power PLC Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Ministry of Mines - Canada
- International Coal Ventures Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Commonwealth Bank - Australia
- Riau Bara Harum - Indonesia
- Edison Trading Spa - Italy
- Chamber of Mines of South Africa
- PowerSource Philippines DevCo
- Aditya Birla Group - India
- Latin American Coal - Colombia
- OPG Power Generation Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Karaikal Port Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Electricity Generating Authority of Thailand
- Barasentosa Lestari - Indonesia
- India Bulls Power Limited - India
- Chettinad Cement Corporation Ltd - India
- Binh Thuan Hamico - Vietnam
- Rashtriya Ispat Nigam Limited - India
- Miang Besar Coal Terminal - Indonesia
- Coal and Oil Company - UAE
- Ministry of Finance - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Jaiprakash Power Ventures ltd
- Neyveli Lignite Corporation Ltd, - India
- Electricity Authority, New Zealand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- San Jose City I Power Corp, Philippines
- Indika Energy - Indonesia
- Straits Asia Resources Limited - Singapore
- Africa Commodities Group - South Africa
- Energy Link Ltd, New Zealand
- Savvy Resources Ltd - HongKong
- Kobexindo Tractors - Indoneisa
- Global Business Power Corporation, Philippines
- Port Waratah Coal Services - Australia
- Sical Logistics Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Gujarat Electricity Regulatory Commission - India
- ICICI Bank Limited - India
- Altura Mining Limited, Indonesia
- Central Java Power - Indonesia
- Meralco Power Generation, Philippines
- Xindia Steels Limited - India
- Toyota Tsusho Corporation, Japan
- GMR Energy Limited - India
- Trasteel International SA, Italy
- Price Waterhouse Coopers - Russia
- Cigading International Bulk Terminal - Indonesia
- VISA Power Limited - India
- Metalloyd Limited - United Kingdom
- Tamil Nadu electricity Board
- Romanian Commodities Exchange
- Agrawal Coal Company - India
- Merrill Lynch Commodities Europe
- Kepco SPC Power Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- PTC India Limited - India
- MS Steel International - UAE
- Thai Mozambique Logistica
- Parliament of New Zealand
- Minerals Council of Australia
- Marubeni Corporation - India
- Vizag Seaport Private Limited - India
- Globalindo Alam Lestari - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- TeaM Sual Corporation - Philippines
- Dalmia Cement Bharat India
- Sakthi Sugars Limited - India
- Energy Development Corp, Philippines
- Kartika Selabumi Mining - Indonesia
- Orica Mining Services - Indonesia
- Siam City Cement - Thailand
- Timah Investasi Mineral - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Indian Energy Exchange, India
- Meenaskhi Energy Private Limited - India
- Kumho Petrochemical, South Korea
- Antam Resourcindo - Indonesia
- Borneo Indobara - Indonesia
- Bhushan Steel Limited - India
- Star Paper Mills Limited - India
- Bangladesh Power Developement Board
- Uttam Galva Steels Limited - India
- Coastal Gujarat Power Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Indonesian Coal Mining Association
- Mjunction Services Limited - India
- IEA Clean Coal Centre - UK
- Heidelberg Cement - Germany
- Asmin Koalindo Tuhup - Indonesia
- Siam City Cement PLC, Thailand
- Goldman Sachs - Singapore
- Independent Power Producers Association of India
- GN Power Mariveles Coal Plant, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Samtan Co., Ltd - South Korea
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