Coal

Based on preliminary data and estimates for the first quarter of 2013, U.S. coal exports, which had been steadily growing since 2009 on an annual basis, were down 1.3 million short tons (MMst) compared with the same period in 2012. Coal exports from the Richards Bay coal terminal in South Africa, a major U.S. competitor for the European market, increased by 6.5 percent during the first four months of 2013 compared with same period last year. EIA expects U.S. coal exports to decline from 126 MMst in 2012 to 105 MMst in 2013 and 106 MMst in 2014.

U.S. Coal Consumption

EIA expects total coal consumption will increase by 7.3 percent from 890 MMst in 2012 to 955 MMst in 2013 as consumption in the electric power sector rises due to higher electricity demand and higher natural gas prices. Consumption grows at a more modest pace of 2.2 percent to 976 MMst in 2014.

U.S. Coal Supply

Coal production is expected to increase by 1.0 percent in 2013, from 1,016 MMst in 2012 to 1,027 MMst in 2013, as inventory draws, combined with an increase in coal imports, meet most of the growth in consumption. However, coal production is forecast to grow by 3.5 percent in 2014 to 1,063 MMst as inventories stabilize in the face of increasing consumption.

Production is further diminished by the projected decline in exports from 126 MMst in 2012 to 105 MMst in 2013 and 106 MMst in 2014. Continuing economic weakness in Europe (the largest regional importer of U.S. coal), falling international coal prices, and increasing production in other coal-exporting countries are the primary reasons for the expected decline in U.S. coal exports.

U.S. Coal Prices

Delivered coal prices to the electric power industry increased steadily over a 12-year period through 2012, when the delivered coal price averaged $2.40 per MMBtu. EIA forecasts average delivered coal prices of $2.40 per MMBtu in 2013 and $2.44 per MMBtu in 2014.