The U.S. Energy Information Administration expects U.S. coal production will grow 2.7% to 1,011 million tons in 2014, driven by higher consumption, the agency said in its latest monthly Short Term Energy Outlook, released July 8.
In 2015, though, the forecasted U.S. coal production falls by 0.9% to 1,002 million tons.
EIA projects total coal consumption growth of 2.8% to 951 million tons in 2014 because of higher electricity demand and power sector natural gas prices nearly 30% above their 2013 level. Total coal consumption is projected to fall by 2.8% in 2015, as retirements of coal-fired power plants rise in response to the implementation of the federal Mercury and Air Toxics Standards (MATS), electricity sales growth slows to 0.1%, and natural gas prices fall relative to coal prices. The initial MATS compliance deadline is in April 2015.
In April of this year, coal exports were 16.6% (1.6 million tons) lower compared with last year, with steam coal exports falling by 1.5 million tons (33.4%). Coal exports are projected to total 99 million tons in 2014, primarily because of slowing world coal demand growth and increasing coal output in other coal-exporting countries. In 2015, projected exports fall to 95 million tons.
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. Monthly average coal prices have increased by 10 cents per MMBtu since the beginning of the year, with the April price averaging $2.40/MMBtu. EIA said it expects average delivered coal prices to increase over the forecast period, with prices of $2.39/MMBtu in 2014 and $2.41/MMBtu in 2015.