Donald Trump’s bombastic promises to restore the United States’ failing coal industry are evaporating in preliminary data from the Mine Safety and Health Administration that show continuing drops in output and jobs.
The agency’s figures for late last year indicate that “production and employment declined by 1.1% and 1.4%, respectively, from the prior quarter,” S&P Global Market Intelligence reports, in a post picked up by the Institute for Energy Economics and Financial Analysis (IEEFA).
The numbers cast a shadow over the optimistic tone from American Coal Council CEO Betsy Monseu, who claimed a bright outlook for coal this year due to stronger markets and “reforms” initiated by the Trump administration. “The changes in policy, regulations, and markets are already contributing to a stronger domestic coal industry,” she claimed, providing “a path to sustainability and the ability to compete that simply wasn’t there in recent years prior, with the continuing threats of the Obama-era regulations.”
News reports in recent months have suggested a coal revival, and IEEFA captures an Associated Press report that shows production from 12 mines in Wyoming’s Powder River Basin increasing 6.3% between 2016 and 2017, to 305.3 million tons. But output across the region “fell to 75.5 million tons in the last few months of 2017, about a seven-million-ton drop compared to the final three months of the previous year,” AP noted.
Overall, despite relief from Trump’s attempts at deregulation, American coal continues to lose market share as domestic utilities increasingly turn to “other forms of generation,” S&P concludes. “The remaining, aging coal fleet is increasingly being replaced by other forms of generation,” the report states. “While export opportunities come and go with international markets, the bulk of U.S. coal production goes to domestic customers.”
While the country will still be using metallurgical coal for steelmaking, analyst Michael Dudas says producers may be “more cautious in bringing on” some of the new capacity originally slated for 2018 due to volatile prices.