Coal news and updates

US coal exports are expected to total 115.3 million st in 2013, according to the September Short-Term Energy Outlook released Tuesday by the Energy Information Administration, which is a 900,000 st increase compared with its August prediction of 114.2 million st of exports.

 

The EIA did not provide a reason for the uptick, but said that economic weakness in Europe, slowing Asian demand, increased global supply and falling international prices continue to put downward pressure on US exports, which totaled a record 126 million st in 2012.

 

The agency said it expects 2014 coal exports to total 109 million st. That forecast is 1 million st higher than the 108 million st of exports projected in August.

Meanwhile, for full-year 2013, the EIA expects the share of US electricity generated from coal will be 40%, up from 37.4% in 2012 -- the lowest slice of the generation mix on record -- but down from 40.3% projected in August's STEO forecasts.

 

The agency said higher natural gas prices meant the share of US electricity generated from gas will fall from a high of 30.4% in 2012 to 27.4% in 2013 and 26.7% in 2014.

 

The EIA believes total US electricity generation will grow by 0.2% in 2013 and by 0.4% in 2014.

 

US coal production reached nearly 89 million st in August, the highest level in a year, according to the agency.

 

For full-year 2013, the EIA expects US coal production will total 1.013 billion st, a downward revision from 1.016 billion st forecast in August's STEO report and down 0.3% from 1.016 billion st produced in 2012.

 

Coal consumption was up in the first half of 2013 due to higher electricity demand and higher gas prices, EIA said. It expects the trend to continue in the second half of 2013, with US coal consumption set to total 942 million st for the full year, a 5.8% rise compared with 2012, it said.

 

The agency projects consumption will grow at a modest rate of 1.8% in 2014, to 959 million st.

 

Inventory draws will meet most of the consumption growth forecast for 2013, the agency said. It reported total coal inventories fell by 19 million st in the first half of 2013 while the agency predicts an additional 9 million st will be withdrawn over the second half of the year.

 

US utility coal stocks currently sit slightly above 150 million st, according to the agency.

 

Nominal annual average coal prices to the electric power industry will likely fall to $2.36/MMBtu in 2013, down slightly from $2.37/MMBtu forecast in August and $2.40/MMBtu in 2012. The agency did not cite a reason for the downward revision.

 

In 2014, the EIA forecasts the annual average coal price to the electric power industry will climb to $2.39/MMBtu.

 

The agency also forecast that the Henry Hub spot price for gas will increase from an average of $2.75/MMBtu in 2012 to $3.68/MMBtu in 2013 and $3.91/MMBtu in 2014.

 

The agency said that despite a decline in August, prices will pick up in September with cooler weather and higher demand for space heating.

 

 

Source: Platts