U.S. Coal Supply and Demand

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U.S. Coal Supply and Demand 2008 Review

Data for: 2008
Report Released: April 14, 2009
Next Release Date: April 2010

Overview

Coal production in the United States in 2008 reached a record level of 1,171.5 million short tons according to preliminary data from the Energy Information Administration (Table 1), an increase of 2.2 percent, or 24.8 million short tons above the 2007 level and 8.7 million short tons above the prior record level set in 2006. Although coal production was higher in 2008, U.S. total coal consumption decreased in all sectors for the year. Coal consumption in the electric power sector in 2008 was lower by 0.3 percent, while coking coal consumption decreased by 2.8 percent and the other industrial sector declined by 3.7 percent. The commercial and institutional sector (which prior to 2008 had been called ‘residential and commercial’), the smallest of all the coal-consuming sectors, declined by 0.6 percent in 2008. (Note: All percentage change calculations are done at the short-tons level.) U.S. coal exports were significantly higher in 2008, while coal imports decreased during the year. Total coal stocks increased in 2008, as some consumers added to their stockpiles. The coal synfuel industry, which grew throughout most of this decade, disappeared from the scene due to the expiration of the available federal tax credits at the end of 2007. The decline in coal consumption during the year was the consequence of slowing domestic economic growth, particularly in the latter half of the year, combined with the weather in 2008, resulting in lower demand for electricity. Preliminary data show that total generation in the electric power sector (electric utilities and independent power producers, including useful thermal output) in the U.S. decreased in 2008. Coal-based generation also decreased, resulting in a 3.5 million short ton drop in coal consumed in the electric power sector. Coal use in the non-electricity sector decreased by 3.3 percent to a level of 80.1 million short tons.

Table 1. U.S. Coal Supply, Disposition, and Prices, 2004 - 2008 (Million Short Tons and Nominal Dollars per Short Ton)
Item	2004	2005	2006	2007	2008
Production By Region
Appalachia	389.9	396.7	391.2	377.8	389.8
Interior	146.0	149.2	151.4	146.7	146.7
Western	575.2	585.0	619.4	621.0	633.6
Refuse Recovery	1.0	0.7	0.8	1.2	1.4
Total	1,112.1	1,131.5	1,162.8	1,146.6	1,171.5
Consumption By Sector
Electric Power	1,016.3	1,037.5	1,026.6	1,045.1	1,041.6
Coke Plants	23.7	23.4	23.0	22.7	22.1
Other Industrial Plants	62.2	60.3	59.5	56.6	54.5
Residential/Commercial Users 1	5.1	4.7	3.2	3.5	3.5
Total	1,107.3	1,126.0	1,112.3	1,128.0	1,121.7
Year-End Coal Stocks
Electric Power	106.7	101.1	141.0	151.2	163.1
Coke Plants	1.3	2.6	2.9	1.9	2.3
Other Industrial Plants	4.8	5.6	6.5	5.6	6.0
Producers/Distributors	41.2	35.0	36.5	34.0	27.3
Commercial/Institutional	-	-	-	-	0.5
Total	154.0	144.3	186.9	192.8	199.2
U.S. Coal Trade
Exports	48.0	49.9	49.6	59.2	81.5
Steam Coal	21.2	21.3	22.1	27.0	39.0
Metallurgical Coal	26.8	28.7	27.5	32.2	42.5
Imports	27.3	30.5	36.2	36.3	34.2
Steam Coal	25.1	28.7	34.6	34.7	32.5
Metallurgical Coal	2.2	1.8	1.7	1.7	1.7
Net Exports	20.7	19.5	13.4	22.8	47.3
Average Prices
Domestic
Average Delivered Price
Electric Utilities	$27.30	$31.22	$34.26	$36.06	$41.23
Independent Power Producers	$27.27	$30.39	$33.04	$33.11	$39.31
Coke Plants	$61.50	$83.79	$92.87	$94.97	$118.09
Other Industrial Plants	$39.30	$47.63	$51.67	$54.42	$63.44
International
Average Free Alongside Ship (f.a.s.) Price
Exports	$54.11	$67.10	$70.93	$70.25	$97.68
Steam Coal	$42.03	$47.64	$46.25	$47.90	$57.35
Metallurgical Coal	$63.63	$81.56	$90.81	$88.99	$134.62
Average Customs Import Value (c.i.v.) Price
Imports	$37.52	$46.71	$49.10	$47.64	$59.83
Steam Coal	$36.06	$43.35	$46.15	$45.31	$56.75
Metallurgical Coal	$54.27	$101.88	$109.36	$96.05	$117.18
1 The sector that was titled 'Residential and Commercial' has been renamed as 'Commercial and Institutional.'. Notes: Totals may not equal sum of components due to independent rounding. Sum of net exports, stock changes, and consumption may not equal production, primarily because the supply and disposition data are obtained from different surveys. Sources: Production, consumption, stocks, and prices: Energy Information Administration, Quarterly Coal Report, October-December 2006, DOE/EIA-0121(2006/Q4) (Washington, DC, March 2007); Annual Coal Report 2005, DOE/EIA-0584(2005) (Washington, DC, October 2006); Annual Coal Report 2007, DOE/EIA-0584(2007) (Washington, DC, January 2009); and Electric Power Monthly, March 2009,DOE/EIA-0226(2009/03) (Washington DC, March 2009). Exports and imports: U.S. Department of Commerce, Bureau of the Census, "Monthly Report EM 545" and "Monthly Report IM 145."

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Overview

Special Topics
Production
Consumption
Coal Prices
Exports and Imports
Coal Stocks

Summary

Tables
Table 1. U.S. Coal Supply, Disposition, and Prices
Table 2. U.S. Coal Production by Coal-Producing Region and State
Table 3. Electric Power Sector Net Generation

Figures
Figure 1. Coal Production by Coal-Producing Region, 2008
Figure 2. Coal Production by Region, 1999-2008
Figure 3. Electric Power Sector Consumption of Coal by Census Region, 2008
Figure 4. Comparison of Coal Consumption to Coal Generation
Figure 5. Share of Electric Power Sector Net Generation by Energy Source, 2007 vs. 2008
Figure 6. Coal Consumption by Sector, 1999-2008
Figure 7. Delivered Coal Prices, 1999-2008
Figure 8. U.S. Coal Export and Imports, 1999-2008
Figure 9. Year-End Coal Stocks, 1999-2008

The international coal markets in 2008 were the driving force behind the increase in U.S. coal production. U.S. coal exports increased to levels not seen since the 1980’s while coal imports declined. U.S. coal exports totaled 81.5 million short tons, an increase of 22.4 million short tons over 2007. Coal imports in 2008 ended the year at 34.2 million short tons, 2.1 million short tons below 2007.

Coal prices increased in 2008, driven, in large part, by the international markets where U.S. coal was in demand. Another factor that affected coal prices was the escalating delivery costs for users due to the growing fuel surcharges added by transportation companies in response to the unprecedented rise in oil prices experienced during the first half of the year. In the domestic markets in 2008, the electric utility price-per-short-ton increase was 14.3 percent, while the increase was 18.7 percent for independent power producers. Coking coal prices had the greatest increase domestically, climbing by 24.3 percent, while the price for the other industrial sector increased by 16.6 percent in 2008. Coal prices in the international markets had the largest percentage increase of all. The average price per ton of export coal, measured in free alongside ship (f.a.s.) value, grew by 39.0 percent in 2008, while the price of coal imported into the U.S., measured by the customs import value (c.i.v.), rose by 25.6 percent.

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