US coal exports seen falling in 2013, 2014 – EIA
US coal exports are expected to fall 8% year on year to 103m tonnes in 2013, according to the country’s Energy Information Administration (EIA) late on Tuesday.
Exports are also expected to fall further in 2014, totalling just 95m tonnes, as continuing economic weakness in Europe, slowing Asian demand growth and increasing output in other coal-exporting countries will continue to keep a firm lid on international coal prices.
The European benchmark contract, the CIF ARA Year 2014, has shed $19.80/tonne – or 19% – since the beginning of the year, with traders seeing little upside price potential for the foreseeable future.
US coal exports reached a record 114m tonnes in 2012 because of low domestic natural gas prices, which left a great deal of coal produced available for export. But with spot prices falling below production costs, there is now little incentive to sell into the Atlantic market.
Rising domestic consumption
Higher domestic electricity demand and higher gas prices have increased domestic coal consumption by 8.8% to 405m tonnes in the first half of 2013. This trend is likely to continue in the second half of the year, the EIA predicted, with the year’s total consumption expected at 849m tonnes, up 5.1% over 2012.
But higher domestic consumption has had little impact on coal production in the first six months of the year, with output falling 3% compared with the same period last year.
Quoting a report by the Kentucky Energy and Environment Cabinet, EIA said employment at the state’s coal mines in the coal-rich Appalachian region was at its lowest level since the data were first collected in 1927.
US steam coal importers
Last week the EIA reported that US steam coal exports in the first six months of 2013 fell 5.4% year on year to just over 24m tonnes.
Administration data show that year-on-year exports into Asia and Africa fell drastically in the first half of 2013.
At 989,475 tonnes, African imports from the US declined 43% from the 1.7m tonnes imported in the first half of 2012, while Asian imports declined by just under 1m tonnes to 4.5m tonnes in the same period.
Europe remained the main importer of US coal, taking 40% or 15.7m tonnes of the total exports recorded between January and June 2013. European imports were down 4% year on year.
South America more than doubled its intake of US coal, however, with imports rising to 1.5m tonnes, compared with the 631,490 tonnes imported in the first half of 2012. Manca Vitorino
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