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Illinois Basin coal RFPs remain outstanding as market waits on weather


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Illinois Basin coal RFPs remain outstanding as market waits on weather

Several requests for proposal remain outstanding for Illinois Basin coal as weather plays a large part in utility buying decisions, sources said June 9.

No awards were made in the week that ended June 9, but a short list is expected soon on Duke Energy Corp.'s phone solicitation for the third and fourth quarters of 2017, a producer source said.

Duke was reportedly looking for upward of 1 million tons of Illinois Basin coal in the third quarter for its Kentucky, Florida and North Carolina plants, the source said.

"Will they buy 1 million tons in Q3? Probably," the source said, adding that other RFPs were expected to be completed in the coming week.

Utilities are reportedly getting inventories under control ahead of summer as they forecast their needs, a second producer source said.

The source noted increased interest in the back half of 2017 but added that much depends on the weather.

"There is some activity that will define markets for the balance of the year, but few utilities are willing to go beyond 2018," the source said.

U.S. coal inventories fell by less than 2 million tons to end the week at an estimated 155.5 million tons, according to data from S&P Global Platts Analytics' Bentek Energy. Stockpiles are 19% below 2016 year-ago levels, according to Platts Analytics.

"There are some utilities that are burning really well," the first producer said. "Others just aren't."

Jeffrey McDonald is a contributing reporter to S&P Global Platts, which, like S&P Global Market Intelligence, is owned by S&P Global Inc.