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Short-Term Energy Outlook

Release Date: August 12, 2014  |  Next Release Date: September 9, 2014  |  Full Report    |   Text Only   |   All Tables   |   All Figures


Electric power sector coal inventories fell to 118 million short tons (MMst) in March, the lowest level since 2006, because of the increase in coal-fired generation as natural gas prices rose, cold weather boosting electricity demand, and rail congestion over the winter slowing coal deliveries. Stocks increased to 136 MMst at the end of May, but were still 40 MMst lower compared with the same time last year. Midwestern coal inventories are down approximately 10 MMst from last year, and this deficit has become an issue for some regional power producers. Electric generators in Wisconsin and Minnesota are citing continuing problems with coal deliveries to power plants. Although generation has yet to be affected, ongoing coal delivery problems have the potential to hinder or even lead to the curtailment of some power production. Year-to-date rail coal shipments are up by nearly 1%, but they have fallen over the past three consecutive weeks.

Coal Supply

EIA estimates that coal production for the first six months of this year (487 MMst) was nearly identical to production over the same period last year. EIA expects that U.S. coal production will grow 2.5% to 1,009 MMst in 2014, driven by higher consumption and a need to replenish consumer inventories, particularly at power producers. In 2015, forecast U.S. coal production falls slightly by 0.2% to 1,007 MMst.

Coal Consumption

EIA projects total coal consumption growth of 2.5% to 949 MMst in 2014 because of higher electricity demand and power sector natural gas prices 22% above their 2013 level. Total coal consumption is projected to fall by 2.7% in 2015, as retirements of coal power plants rise in response to the implementation of the Mercury and Air Toxics Standards, electricity sales growth slows to 0.4%, and natural gas prices fall relative to coal prices.

Coal Exports

In May, coal exports were 26.3% (2.8 MMst) lower compared with last year, with nearly equal tonnage declines for steam and metallurgical coal. Coal exports are projected to total 99 MMst in 2014, primarily because of slowing world coal demand growth, lower international coal prices, and increasing coal output in other coal-exporting countries. Coal exports remain flat in 2015.

Coal Prices

Annual average coal prices to the electric power industry fell over the past two years, from $2.39/MMBtu in 2011 to $2.35/MMBtu in 2013. EIA expects average delivered coal prices to increase over the forecast period, with prices of $2.38/MMBtu in 2014 and $2.39/MMBtu in 2015.

U.S. Coal Summary
  2012 2013 2014 2015
Prices (dollars per million Btu)
Electric Power Sector 2.38 2.35 2.38 2.39
Supply (million short tons)
U.S. Coal Production 1016.4 984.0 1008.5 1006.7
Imports 9.2 8.9 12.7 10.8
Exports 125.7 117.7 98.8 99.0
Consumption (million short tons)
Electric Power Sector 823.6 858.4 882.2 856.5
Other Sectors 65.6 66.8 66.4 66.6
Total Consumption 889.2 925.1 948.6 923.1
End of Period Inventories (million short tons)
Electric Power Sector 185.1 148.0 130.6 133.3
Total Inventories 238.9 197.5 181.6 186.1

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