trending Market Intelligence /marketintelligence/en/news-insights/trending/dywkr91rhhmbi3d7rr0v0g2 content
Log in to other products

Login to Market Intelligence Platform


Looking for more?

Contact Us

Request a Demo

You're one step closer to unlocking our suite of comprehensive and robust tools.

Fill out the form so we can connect you to the right person.

If your company has a current subscription with S&P Global Market Intelligence, you can register as a new user for access to the platform(s) covered by your license at Market Intelligence platform or S&P Capital IQ.

  • First Name*
  • Last Name*
  • Business Email *
  • Phone *
  • Company Name *
  • City *
  • We generated a verification code for you

  • Enter verification Code here*

* Required

Thank you for your interest in S&P Global Market Intelligence! We noticed you've identified yourself as a student. Through existing partnerships with academic institutions around the globe, it's likely you already have access to our resources. Please contact your professors, library, or administrative staff to receive your student login.

At this time we are unable to offer free trials or product demonstrations directly to students. If you discover that our solutions are not available to you, we encourage you to advocate at your university for a best-in-class learning experience that will help you long after you've completed your degree. We apologize for any inconvenience this may cause.

In This List

A common thread in executives' Q4 quotes: 'Everyone's trying to export coal'

Q2: U.S. Solar and Wind Power by the Numbers

Essential Energy Insights - September 17, 2020

Essential Energy Insights September 2020

Rate case activity slips, COVID-19 proceedings remain at the forefront in August

A common thread in executives' Q4 quotes: 'Everyone's trying to export coal'

U.S. coal producers reaped the benefits of a new landscape on both market and regulatory fronts in 2017 while looking ahead to what 2018 and beyond might bring to a sector that sees many opportunities abroad but relatively few at home.

With many companies putting bankruptcy reorganizations in the rearview and with the expectation of favorable treatment from the current presidential administration, coal mining companies have been able to imagine their place in the future of U.S. coal. For some, that means a focus on returning cash to shareholders instead of growth. Others see room to play a role in the consolidation of the sector or pivoting to a focus on coal for steelmaking or exports instead of domestic utility customers whose aging and retiring power plants continue to require less coal.

S&P Global Market Intelligence listened to a wide range of coal earnings calls over the past quarter and compiled some of those comments. The standout quotes are in italics below.

"[S]trong pricing means that everyone's trying to export coal ... and that's the bottom line," Cloud Peak Energy Inc. President CEO Colin Marshall said on the company's fourth-quarter earnings call of recent opportunities to push U.S. coal overseas.

The Powder River Basin coal mining company, which touted its success in contracting export deals with Asian utility customers, is just one of several that said they have been relying on coal exports in the wake of stagnant domestic coal demand in the U.S.

"The international coal markets ... remain positive," Alliance Resource Partners LP President and CEO Joseph Craft said. "As of today, we have secured 2018 delivery commitments for 5.7 million tons to the thermal export market and 150,000 tons to the international metallurgical market. We expect more opportunities to sell into both of these markets for 2018 and beyond."

Alliance has recently expanded its presence in the international thermal and metallurgical coal space, increasing year-over-year shipments in those markets by 4.7 million tons up to 6.3 million tons, or about 16.7% of the partnership's 2017 coal sales volume. Alliance has said it is positioned to expand its production levels and capture market share if more domestic or international opportunities arise.

Foresight Energy LP CEO Robert Moore said he does not see any catalysts likely to move domestic coal prices one way or the other in the near future. The company is focusing a "significant amount of time" on export market opportunities in an effort to tighten up domestic supply and realize higher profits on coal sales, Moore said.

"I do think there's a lot of opportunity in the export market. Demand for our product is really strong right now," Moore said. "We know that there are some folks out there that have not been able to deliver into the export market as a result of river conditions, and we are taking advantage of that."

CONSOL Coal Resources LP CFO David Khani said recent activity in the spot market for coal indicates export opportunities are tightening up the domestic market.

"Arguably, the export market is stronger today than it was in the first half of 2017, which should help drive more exports in 2018," Khani said. "The market is setting up nicely where both coal and natural gas inventory levels are likely to end winter nicely below normal levels, setting up a stronger restocking pull during the next seven months."

While Peabody Energy Corp. is not a substantial supplier of seaborne U.S. coal, its operations in the U.S. benefit from domestic production being pulled into export markets. The company also moves thermal and metallurgical coal export tons from its Australian operations. Post-bankruptcy, the company is largely focusing on maximizing margins and returning cash to shareholders versus growing production and is closely watching for changes in a fickle coal market.

"As we saw in 2017, even small changes in demand or disruptions in supply can result in meaningful impacts to pricing, given current supply tightness," Peabody President and CEO Glenn Kellow said. "Both seaborne met and thermal coal supplies remain tight on continued logistical and operational constraints across the industry."