Coal News and Markets
Week of June 27, 2004
Coal Prices and Earnings (updated June 28, 2004)
In the trading week ended June 25, the average spot coal price tracked by EIA for the Illinois Basis increased by $0.50, to $31.75 per short ton, and the average price for Powder River Basin coal declined by $0.50, to $5.75 per short ton. The indexed prices for Appalachian and Uinta basin coal were unchanged. After holding at $56.00 to $56.50 per short ton during most of May, spot coal prices for premium Central Appalachian compliance coal again went above $57.00 for
the trading week ended June 4 and established a new high of $57.75 per short ton (see graph below). Previously, Central Appalachian spot prices had passed the $45.00 per short ton level in the week ended February 13 and passed the $55.00 mark in the week ended March 5 (f.o.b. rail, for actual delivery in the prompt quarter). That same week, medium-Btu Pittsburgh seam bituminous coal, cleaned to less than 3 percent sulfur, passed the $45.00 per ton mark, f.o.b. rail in Northern Appalachia, then plateaued at $46.00 per short ton during the weeks ended March 12 through April 23. The average spot price retreated to $45.00 per short ton in the week ended April 30, and has not changed. Coal from the Uinta Basin, an alternate source for low-sulfur bituminous coal, rose to $27.50 per short ton, f.o.b. rail, in the week ended June 4. This also was a new high average spot price.
| For the trading week ended June 25, the following average spot coal prices were added: |
|
| Central Appalachia (12,500 Btu, 1.2 SO2) | $57.75 per short ton, unchanged |
| North Appalachia (13,00 Btu <3.0 SO2) | $45.00 per short ton, unchanged |
| Illinois Basin (11,800 Btu, 5.0 SO2) | $31.75 per short ton, up from $31.25 |
| Powder River Basin (8,800 Btu, 0.8 SO2) | 5.75 per short ton, down from $6.25 |
| Uinta Basin (11,700 Btu, 0.8 SO2) | $27.50 per short ton, unchanged |
With spot coal prices high and holding, new term contract prices are reportedly higher than in recent years for coal in the East. Some mines that were temporarily closed or curtailed are coming back on line. Eastern bituminous producers that can perform the additional needed coal preparation and produce good metallurgical coal are tapping into exceptionally high selling prices in the export market, and also benefiting from relatively favorable U.S. dollar exchange rates. High oil prices, signs of a recovering economy, and growing electricity demand set an operating climate with firm price floors and tight coal supplies during the coming months.
Coal Production (updated June 21)
EIA estimates coal production of 462.8 million short tons (mmst), through the week ended June 5, 2004. That is roughly 3.0 mmst, or 0.7 percent, ahead of the same period last year. The net increase, however, is all attributable to production west of the Mississippi River, which is 10.1 mmst higher, year to date, than in 2003. East of the Mississippi, production has not risen along with demand, lagging 7.0 mmst behind the same period in 2003. The latest monthly production comparisons (see below), for May 2004 versus May 2003, reveal a 4.0 mmst decrease, which equates to 4.4 percent less production last month than in May 2003.
 Note: This graph is based on revised MSHA coal production survey data for quarters 1 through 4 of 2003, new revisions for quarter 1 of 2004, and preliminary EIA production estimates through May 2004. |
View Earlier Coal News and Markets Reports
|
|
Contact(s):
Rich Bonskowski
Phone: 202-287-1725
Fax: 202-287-1934
e-mail: Richard BonskowskiBill Watson
Phone: 202-287-1971
Fax: 202-287-1934
e-mail: William Watson