|Coal Commodity Region/Fuel||Avg. BTU||SO2||Price||Price/mmBTU|
|Powder River Basin||8,800||0.8||$11.55||$0.66|
|Natural Gas (Henry Hub)||n/a||0.01||n/a||$2.75|
By T.L. HEADLEY, MBA, MA
Coal production in the U.S. rose sharply for the week ending July 18, compared to the previous week – continuing the positive trend of the past few weeks. However production continues to fall short of last year according to the latest report from the Energy Information Agency (EIA) for the week.
Production in the United States increased by 801,000 tons (4%) to finish the week at 16.40 million tons compared to last week’s total of 16.40 million tons. Meanwhile, production for the week is off by 2.24 million tons (11.5%) from the 19.44 million tons for the same week in 2014. Cumulative production for the year-to-date remains down as of July 18, coming in at 492.60 million tons compared to 538.54 million tons last year – a decline of 45.94 million tons or 8.5%. Production for the previous 52 weeks also trended lower – finishing at 951.19 million tons compared to 985.32 million tons for the same period ending in 2014 (-3.5%).
Mirroring the coal production, the number of coal rail car loadings increased, finishing the week up 21% from the previous week – 99,975 carloads from 82,924 carloads last year. However, loadings remain down sharply compared to the 2014 (-11.6%). Coal loadings also continued their decline year-to-date – off 9.4% from the same period in 2014.
Export and import data was not updated this week.
Electric output was up 6.5 percent compared to the same week in 2014, with 88 MWH of electricity produced compared to 82.61 MWH produced for the same period last year.
Domestic steel output was also up over the previous week.
According to numbers from the American Iron and Steel Institute, domestic raw steel production was up by 0.7% from the previous week, coming in at 1.75 million tons compared to 1.74 million tons last week with a capacity utilization factor of 73.3%. However, steel production was down sharply from the same week last year, when 1.91 million tons were produced at a capacity utilization rate of 79.6%. Steel production continues its slide year-to-date – down 7.7% to 48.7 million tons produced compared to 52.79 million tons for the same period last year.
In terms of regional coal production, all three major basins again reported higher production for the past week compared to the previous week, however all continue sharply lower compared to the same week in 2014.
The Appalachian Basin finished at 4.48 million tons, up from 4.28 million tons last week (+4%). Interior Basin production also finished up at 3.32 million tons compared to 3.16 million tons last week (+5%). Western production finished the week at 9.40 million tons from 8.96 million tons last week (+5%). However production remains sharply below the same week in 2014. The Appalachian Basin is off by 12.9% from the same week last year. The Interior Basin is off 11.8% from 2014. And Western production is off 10.9% from the same period in 2014.
All three basins also continue to report significant declines in production year-to-date, with Appalachia down 12.6%, the Interior Basin off 7.2% and the Western Basin down 6.9%.
Looking at the previous 52 weeks, all three basins are trending lower for the period ending July 18, with the Appalachian Basin down 7.0%, the Interior Basin down 1.2% and the Western Region down 2.5%. Production in the Interior Basin fell to 180.95 million tons from 183.16 million tons for the same period in 2014. Appalachian production fell for the period to 248.65 million tons from 267.30 million tons. Meanwhile, Western production is down to 521.59 million tons from 534.87 million tons in 2014.
According to the West Virginia Office of Miners’ Health Safety and Training, coal production in the state now stands at 50.40 million tons through July 9. Of that total, 40.68 million tons was mined by underground operations and 9.71 million tons was produced by surface mining. A total of 112 mines are now reporting production through May 2015.
According to WV OMHST, coal mining employment in West Virginia has now dropped to 15,200 total miners, with 12,401 working underground and 2,799 working on surface operations. The office does not report data for contract miners or preparation plant workers on a weekly basis.
According to EIA, West Virginia coal production for the week totaled 1.96 million tons compared to 1.82 million tons for the previous week (+5.4%). However, this is off by 12.8% from the same week in 2014.
Production increased in both the northern and southern coalfields of West Virginia compared to last week, by 4.9% in the northern field and 4.8% in the southern coalfields. Production is off in both areas year-to-date, by 1.1% and 17.7% respectively.
Coal production in Kentucky for the week ending July 18 was also up compared to the previous week but remains down from the same period in 2014. Kentucky production for the week was reported at 1.26 million tons, up from 1.20 million tons last week but down from the 1.51 million tons for the same week in 2014. Both the eastern and western regions of Kentucky reported significant increases in production from the previous week but the state continues to see significant declines in both fields year over year. Year to date, production in Kentucky is off by 16.2%. Meanwhile production in the state is off by 10.2% for the previous 52 weeks, with western Kentucky reporting an 8.6% decline and eastern Kentucky operations reporting a decline of 11.9% year-over-year.
Wyoming coal production was also up for the week, coming in at 6.83 million tons, compared to 6.52 million tons the previous week, but down from the 7.66 million tons produced for the same week in 2014 – a decline of 14.9%. For the previous 52 weeks, Wyoming production is down 2.0%.
Illinois production was up, finishing the week at 1.13 million tons compared to 1.08 million tons last week. Illinois production is also up by 13.1% for the previous 52 weeks. Indiana production is up as well, coming in at 651,000 tons compared to 621.000 tons for the same week in 2014. Indiana production is also down by 6.3% over the previous 52 weeks. Pennsylvania production for the week also finished up, to just 1.07 million tons versus 1.02 million tons for the previous week, but production in the Keystone State is now down slightly (0.9%) for the previous 52 weeks.
Ohio production also finished slightly higher – at 355,000 tons compared to 338,000 tons the previous week. Ohio coal production is off 17.4% year-to-date and down 13.5% for the previous 52 weeks, compared to the same period ending in 2014. Virginia production increased this week – to 235,000 tons compared to 224,000 tons for last week. Virginia production year-to-date is off by 16.6% and down for the previous 52 weeks by 14.5%.
Coal prices on the spot market held steady this week. Central Appalachian coal finished at $54.90 per ton or $2.20 per mmBtu. Northern Appalachian coal held at $53.20 per ton or $2.05 per mmBtu. Illinois Basin coal closed unchanged at $34.35 per ton or $1.46 per mmBtu, while Powder River Basin coal held at $11.55 per ton or $0.66 per mmBtu, and Uinta Basin coal prices were firm at $39.35 per ton or $1.68 per mmBtu.
Meanwhile, on the NYMEX Coal Futures board, Central Appalachian coal is up to $43.13 per ton compared to $41.03 per ton to last week, while Western Rail fell 1 cent to $10.04 per short ton and Eastern Rail coal is up to $42.33 per short ton.
Natural gas prices on the Henry Hub added 14 cents to finish the week at $2.89 per mmBtu. Natural gas producers again reported a significant increase in their stored reserves – up 99 billion cubic feet compared to the previous week, for a total of 2.77 trillion cubic feet in storage. This week’s working natural gas rotary rig count is up by 19 from last week to 876 working rigs. However, the count remains down by 1007 rigs from a year ago – down 53%. This number includes rigs working in both oil and gas plays.