EIA: Short-term Trends Were Positive for U.S. Coal Industry in 2022

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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--The U.S. coal industry had some good news in 2022, recording increases in production, exports, employment and prices. Despite those year-over-year gains, domestic demand for coal continued its long, slow decline last year as electric generators, which use most of the coal mined in the U.S., continued to reduce their use of coal, according to a new report on coal from the U.S. Energy Information Administration (EIA).

U.S. coal production increased about 3% in 2022 over 2021 levels, to 594.2 million short tons, said EIA's Annual Coal Report 2022, released October 3. While 2022's production gain likely was welcomed by coal producers, over the last decade, coal production of all types--bituminous, subbituminous, lignite and anthracite--has fallen about 40%, from about one billion short tons in 2014 to last year's 594.2 million short tons, the EIA report said.

Click on the image at right to see 10-year production trends for all forms of coal mined in the U.S.

Over the last 10 years, the EIA report added, as production of bituminous coal, subbituminous coal and lignite each fell between 38% and 44%, production of anthracite coal, a small component of overall coal production, rose nearly 28%.

On a year-over-year basis, the number of people employed in coal mines was another bright spot in 2022: employment rose about 10%, to 43,582 people from 39,518 in 2021.

U.S. coal exports to Europe soared in 2022 following Russia's invasion of Ukraine and the ensuing embargo of Russian fossil fuels. U.S. exports of coal to Europe rose 50%, to 33,575 million short tons in 2022 from 22,341 million short tons in 2021. Europe accounted for about 39% of all U.S. coal exports in 2022, far more than sales to Canada, Brazil or Japan.

Prices for all types of coal jumped in 2022, the EIA report said:

• The average price of bituminous coal was $97.96 per short ton, a 59% increase from 2021.
• The average price of subbituminous coal was $16.55 per short ton, up approximately 17% from 2021.
• The average price of thermal coal increased about 34% from 2021 to $34.57 per short ton.
• The average sales price of metallurgical coal increased 72.9% from 2021 to $262.72 per short ton.

All end-uses paid more for coal in 2022 compared to 2021. Electric power generators, who consume about 90% of all coal, paid an average of $44.51 per short ton of thermal coal last year, a 19% gain over the $37.32 per short ton they paid in 2021. Price increases varied widely across North American Electric Reliability Corporation (NERC) regions, with generators in the New England, Mid-Atlantic and South Atlantic regions paying significantly more than average for their coal last year. But generators located closer to major coal basins, such as in the Mountain, West South Central and West North Central regions paid meaningfully less than the national average for their thermal coal in 2022.

Click on the image at right to see a blended average price paid for coal by end users.

Other users of coal, including non-power industrial and coke, had higher year-on-year percentage price gains than electric generators last year. Coke users paid 60% more for their coal last year than they did in 2021, while non-power industrial users saw prices jump 21% over 2021 prices. Only commercial and industrial users of coal saw low levels of price gains, about 8% over 2021.

Last year, U.S. coal consumption declined to about 515 million short tons, a 5% drop compared to 2021. The electric power sector accounted for about 92% of the total U.S. coal consumed in 2022, the EIA said.

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