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For U.S. power firms, EPA ruling barely a bump on road to natgas

For big U.S. power companies like FirstEnergy Corp, the Supreme Court’s decision knocking back landmark rules reducing air pollutants from coal-fired plants has arrived too late for them to turn away from a natural gas-fueled future. Big coal-fired generators said on Monday that they would press ahead with facility upgrades and plant closures even after the court invalidated one of President Barack Obama’s major environmental initiatives, which would set new limits on the amount of mercury and other hazardous pollutants. In a 5-4 decision, the court found that the U.S. Environmental Protection Agency (EPA) should have considered the compliance cost of the Mercury and Air Toxics Standards (MATS) rule. The EPA has estimated it would cost the power industry $9.6 billion a year to comply with the rule. While the prospect of a suspension in the rule – and increased demand for coal – cheered some investors on Monday, […]

Posted On : Published By : Tom Whipple
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Biggest Coal Shipper’s Power Plan Offers Relief From Bear Market

The coal market’s best hope of breaking a four-year losing streak may be its biggest supplier’s plan to burn more at home. Indonesia plans to expand generating capacity by 46 percent in four years with new power plants, half of them burning coal. If that happens, fuel consumption may triple to the equivalent of 76 percent of last year’s exports and boost prices more than 50 percent, the Indonesia Coal Mining Association says. The country currently consumes less electricity than Taiwan, a nation with about a 10th of its population. Benchmark Asian coal prices fell every year since 2010 after producers from Australia to Colombia flooded the market and demand faltered in China, the biggest consumer. “Any reduction in Indonesian exports helps the seaborne market,” said Ted O’Brien, chief executive officer of Doyle Trading Consultants, a coal industry analytical firm based in Grand Junction, Colorado. “Like other Asian countries, […]

Posted On : Published By : Tom Whipple
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US 2015 power-sector coal consumption to hit 1991 low: EIA

US coal consumption for the power sector will total an estimated 792.9 million st in 2015, the lowest amount since 1991, the Energy Information Administration said Tuesday. Lower natural gas prices are the main reason behind the decline, the agency said in the June edition of its Short Term Energy Outlook. In 2014, coal consumption in the power sector totaled 851.4 million st. Tuesday’s report is another indication of how far the US coal industry has fallen since the shale boom has increased gas supplies and lowered prices. The year-over-year drop comes despite the agency’s forecast for the average US residential electricity costumer to spend 4.8% more during June, July and August, reflecting a 2.6% increase in the average electricity usage and a 2.1% increase in the average retail price of electricity. Article continues below… Platts Coal Trader provides the latest prices for key benchmark coals, as well as: […]

Posted On : Published By : Tom Whipple
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Illinois Basin coal market stressed by low demand, prices

The Illinois Basin market continues to wilt as low spot demand and ongoing production leaves more tons on the ground and anxious producers with more to sell, market sources said Friday. "We’re at the point where it’s no longer rhetoric to say we’re going to leave coal in the ground rather than sell at these prices," one producer said. While there have been some indications of production discipline — notably Murray Energy’s recent announcement that it would lay off some Illinois Basin employees as well as rumored production cutbacks at some other basin mines — the market is still dealing with oversupply. "We haven’t been in the market for some time," one utility source said, adding that low power and gas prices are keeping them out of the IB market. "We’re long this year, building our stockpiles." Article continues below… Platts Coal Trader provides the latest prices for key […]

Posted On : Published By : Tom Whipple
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In Kentucky, talk of a ‘war on coal’ gives way to hope for new economy

HARLAN COUNTY, KY When Dan Mosley became head of Kentucky’s Harlan County government this year, he promised – like those elected before him – to defend the state’s beleaguered coal industry. But Mosley also vowed to do something else for his county: help build a new economy based on something other than coal. "The best business I’ve seen in town lately has been the U-Haul business because people are moving out," said Mosley, a boyish-looking father of two, speaking after a community meeting in the century-old coal town of Benham. "The time has come to wipe away our tears," he says. "We have no choice but to diversify.” Talk of an economic transition remains difficult in eastern Kentucky, where you can still spot bumper stickers that read "Mine Every Lump" and statues honor coal miners. These are the people Kentucky Republican Senator Mitch McConnell says are victims of an […]

Posted On : Published By : Tom Whipple
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Glencore May Cut Coal Output Further to Combat Glut

Coal prices have fallen sharply since Glencore closed its purchase of Xstrata two years ago. In a rare public presentation, Glencore’s Australia-based head of global coal assets, Peter Freyberg, insisted coal was “a very, very important part” of the company, and that executives were considering options to acquire new assets or tie up with other producers with an eye to the long-term. When Glencore closed its purchase of fellow miner Xstrata PLC two years ago, Chief Executive Ivan Glasenberg said the blockbuster deal was “a big play on coal.” Since then, coal prices have fallen sharply, while Glencore’s market value has dropped close to its lowest level since it floated in London and Hong Kong in 2011. Both thermal coal, burned to generate electricity, and coking coal, used to make steel, are languishing due to oversupply caused by too many new projects coming on stream amid slowing demand, particularly […]

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Weekly US coal production estimates fall to five-year low: EIA

Weekly US coal production totaled an estimated 15.1 million st in the week ended May 30, the lowest level in the last five years, US Energy Information Administration data showed Thursday. The estimate was down 6.1% from the prior week and down 20.7% from the year-ago week. It marks the 15th straight week of declining coal production estimates when compared with year-ago levels. The EIA does not comment on its production estimates, but low natural gas prices and increasing coal stockpiles are largely behind the drop in production. Platts unit Bentek Energy estimated coal stockpiles stood at 168.7 million st as of May 28, roughly 24% higher than the same time last year, and up 1% from the five-year average for the week. Article continues below… Platts Global Coal Alert brings real-time coal industry information to those who can’t afford to wait until tomorrow to get market coverage and […]

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US coal exports down in April but show increased shipments to India

US coal exports totaled slightly more than 6.4 million mt in April, down 5.2% from the prior month and down 11.3% from the year-ago month, the US Census reported Wednesday. The weaker figures were partly due to weather-related delays in February, which pushed some loadings into March. However, the year-over-year decline also reflects continued weakness in the seaborne market for both thermal and metallurgical coal. Platts assessed the spot price for low vol US met coal FOB US East Coast on Wednesday at $102.50/mt, down 13.3% from a year-ago. Met coal exports totaled 3.8 million mt in April, down 20.2% from March and down 18.1% from the year-ago month. For the year, met coal exports total 16.1 million mt, down 19.5% compared with the same period last year. Article continues below… Platts Coal Trader provides the latest prices for key benchmark coals, as well as: Daily pricing for tons […]

Posted On : Published By : Tom Whipple
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As Coal Prices Fall, Miners Cut Output

SYDNEY—China’s appetite for coal used in steelmaking is faltering, deepening a market downturn miners say is the worst in recent memory. The price of steelmaking coal shipped from Australia, the world’s biggest exporter, has fallen 23% this year to roughly $86 a metric ton, its lowest level in nearly a decade. The slide extends a decline begun in 2011, during which the fuel’s value has slumped by around three-quarters. But analysts caution that prices will recover only if more cuts are made. The consultancy Wood Mackenzie doesn’t expect the oversupply of steelmaking coal, or coking coal, to clear up until about 2022. China, whose breakneck economic growth has been the engine for most global commodity markets, won’t need as much steelmaking coal in future, analysts now project. That leaves miners who rushed to open new pits in the boom years to struggle. Chinese sectors such as heavy industry and […]

Posted On : Published By : Tom Whipple
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Rhino Resource Partners idles majority of US Central Appalachia coal operations

Rhino Resource Partners is temporarily idling a majority of its US Central Appalachia coal operations because of the ongoing weakness in the coal markets, the producer said in a statement Tuesday. The company has sent out WARN notices to a total of 192 workers at its CAPP operations that include three surface mines and one underground mine at the Tug River, Rob Fork, and Deane mining complexes located in eastern Kentucky and West Virginia. Exactly how many employees that will ultimately be affected will depend on future market conditions for CAPP metallurgical and thermal coal, Rhino said. "We are taking difficult actions that are necessary due to the persistent weakness in the coal markets," CEO Joe Funk said in the statement. "Demand for Central Appalachia steam coal has fallen to unprecedented levels as utilities choose low-priced natural gas for electricity generation and other coal-fired capacity is shuttered due to […]

Posted On : Published By : Tom Whipple