July 20, 2020 Read More →

S&P: U.S. coal exports down 29% through May 2020 compared to 2019

S&P Global Market Intelligence ($):

The U.S. coal sector is taking another beating as exports to two key markets, Asia and Europe, plunged in the first five months of this year.

U.S. exports between January to May totaled 27.6 million tonnes, falling 29.0% from the amount shipped over the same months last year, S&P Global Market Intelligence data show. Of the total, the U.S. shipped 12.4 million tonnes to countries in Asia, down 11.5%, and 8.9 million tonnes to European countries, which also fell 36.3% from the prior year.

About 80.2% of the coal exported for steelmaking from the U.S. during the first quarter went to countries in Asia and Europe, data from the U.S. Energy Information Administration shows. However, global steel production has been down about 5% this year through May with steep declines in North America, the European Union and South America, Moody’s analysts add.

Among the 20 largest destinations for U.S. coal exports year-to-date, 15 showed year-over-year declines. Shipments to India, where the U.S. shipped the most tonnes through May, fell by 14.0% from the same period a year ago. Meanwhile, other countries such as South Korea, China, Turkey, Singapore, and the Dominican Republic saw year-on-year increases.

The downturn in U.S. coal exports could stretch through the end of 2020. In its most recent “Short-Term Energy Outlook” released in early July, the EIA projected that coal exports will fall 32% to 63 million tons this year before recovering and growing by 7% in 2021.

U.S. metallurgical coal exports for the calendar year 2020, for instance, are expected to drop by about 10 million tonnes from 2019 levels, according to Jim Truman, Wood Mackenzie’s director for global metallurgical coal markets. “Reductions shouldn’t be too surprising, as the U.S. is the classic swing supplier to the seaborne metallurgical coal markets and overall trade is down, as well as prices,” Truman told S&P Global Market Intelligence in a July 14 email, adding that China and India will be “the most important drivers to the recovery of total seaborne trade.”

[Robert Vergara and Stephanie Tsao]

More ($): U.S. coal exports through May plunge 29% YOY as COVID bears on global markets

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