The Energy Information Administration reports today that exports drove an overall increase in U.S. coal production in 2011. The U.S. produced less coal for electricity as utilities switched to cheaper (and cleaner-burning) natural gas. But coal shipments to other countries were the highest they’ve been in two decades, and the numbers show those shipments are increasingly coming through the Pacific Northwest to meet growing demand in Asia.**
The EIA cites two reasons for the uptick in exports: flooding in Australia, the world’s largest coal exporter, and global coal demand for electricity and steelmaking.
The report highlights an important trend for the Northwest. Of all the coal consumed in the U.S. last year, 93 percent was used for electricity. But coal consumption for electricity dropped by 4 percent from 2010 to 2011.
As the EIA reports: “Much of the coal that was not used by utilities was transported by train, in most cases, to major U.S. seaports where it was exported.”
Since 2009, Seattle** has become one of the six major seaports for coal exports in the U.S. – and the only one on the West Coast. Last year, flooding in Australia, the world’s largest coal exporter, contributed to increased U.S. coal exports to India, Japan, and South Korea. But long-term, the EIA has clearly projected an increase in Asian demand for coal.
As you know, coal companies are looking for additional Northwest export outlets in Bellingham, Wash., Longview, Wash., and at two Oregon ports on the Columbia River, to deliver Powder River Basin coal to Asia.
As the graphs above show, Seattle** has already seen a surge in the amount of coal being exported in the past couple years, from less than a million tons in 2009 to 3.5 million tons in 2010 and nearly 3.5 million tons in the first eight months of 2011.
As the EIA reports:
“Combined annual exports from Norfolk, Virginia and Baltimore, Maryland increased 18 million tons from 2000 to 2010. For the first eight months of 2011, New Orleans, Louisiana coal exports grew 980% above the 2000 level and surpassed the record 2010 level by nearly 50% despite flooding along the Mississippi River disrupting barge traffic. Coal exports from Seattle, Washington have also risen sharply in recent years as significant coal production in the Powder River Basin seeks access to growing Asian coal markets.”
**As I noted in a later post, the EIA’s “Seattle” label refers to a regional district. The Port of Seattle itself is not handling coal. Rather, coal shipments are coming through the larger Seattle Custom District by rail on their way to the Port of Vancouver in British Columbia. From there, they are shipped to Asia.