Join the discussion on the following article:
Capturing what remains amid coal decline
The “war on coal” is working.
The “War on coal” is a not the full story. It’s about Powder River Basin and Illinois Basin Coal being cheaper to produce per ton than Appalachian.(not to mention controversial Mountaintop Coal Removal) It’s the lower price of natural gas. Its the strong dollar hurting exports. Its a world economy that has a cyclical nature. Coal will come back, but it’s a question of who and where it’s mined.
Could some of these lines be shortlined?
The fact is that since 1956, if not it’s very inception, the N&W has been trying to put the Virginian to bed! And I say that as a NS stockholder! It’s truly a shame that what was a very fine railroad is all but gone.
“Less than two weeks ago”, Trains “would never have envisioned” a portion of the former Virginian on the endangered list? Where have you been for the past 2+ years? This is not merely a down-cycle in the domestic steam coal market; rather, it is probably a permanent structural change in demand for this commodity cased by technological change (read “fracking”) and more challenging EPA regulations. As a consequence, naturally the higher-cost coal suppliers are being hit the hardest. Railroad assets that are entirely or primarily dedicated to this type of traffic are likely to be written-down or written off. NS and CSX will need to re-calibrate their networks and operations going forward to grow more traffic of other kinds such as but not limited to intermodal and earn the best margins they can on that business. Capex will no doubt be re-directed accordingly.