Gulf Coast coal ship departures plummeted 57.1% to just six ships due to low Mississippi River levels, impacting St. Louis loading and coal prices, with Egypt, Panama, and Japan as top destinations.
Mississippi River
The Mississippi River at Baton Rouge, at 5.8 feet above sea level on Sept. 12, matched levels from when Ingram Barge Company declared force majeure in 2022. Low water levels can narrow the river, posing challenges for tanker traffic and causing barges to get stuck on the sides.
Coal from the Illinois Basin is transported downstream to Gulf ports for export markets, and in 2022, low river levels impacted coal prices. St. Louis barge loading drafts were 15% below normal capacity on Sept. 11, further affecting coal transportation.
FOB New Orleans coal prices for 6,000 kcal/kg NAR coal increased by 50 cents to $84/mt on Sept. 12. FOB NOLA coal prices have ranged from $74.50/mt to $85.23/mt over the past 39 sessions
Atlantic Coast Coal
“Some coal customers use multiple ports so if an East Coast customer also runs coal out of the Gulf, we may end up getting more cargoes coming to the East Coast if there’s a problem,” a US terminal operator told S&P Global Aug. 23. “It’s customer by customer because you have to have a spot at a terminal to use and if our space is already taken up, I can’t create a new contract. Yet if a customer has space with me, they can run more tons if they can physically do that with railroads or barges.”
- West Coast and Atlantic Coast coal ship departures surged by approximately 60% due to reduced Gulf Coast activity, as per cFlow data.
- Weekly departures from the Atlantic Coast increased to 16 coal ships, totaling one million dwt, compared to 10 coal ships with 611,516 dwt in the prior week.
- Top destinations for Atlantic Coast-shipped coal were Gibraltar (325,233 dwt), Brazil (159,996 dwt), and the Netherlands (138,805 dwt).
Rising Coal Prices
FOB Baltimore 6,900 kcal/kg NAR coal, assessed on Sept. 12, saw a 50 cent increase to $88/mt, with a trading range of $80/mt to $90/mt over the past 27 sessions. The uptick in departures signifies a shift in coal shipping patterns with increased Atlantic Coast activity amid the changing dynamics.
West Coast departures climbed to a seven-week high of five coal ships. West Coast coal ships carried 230,376 dwt, up from 149,514 dwt the week before. West Coast coal shipments were bound for Japan at 116,297 dwt; South Korea, 81,756 dwt; and China, 32,323 dwt.
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Source: S&P Global Community Insights
