There is a rumor in the utility industry that China is buying up coal contracts in the US. Are we going to see the day when unit trains will be going to the west coast with coal to be loaded on ships bound for China ?
In 2009, the U.S. exported 1.0 million short tons of metallurgical coal to China and 158 thousand short tons of steam coal. To put this in perspective, total U.S. coal exports for 2009 were 59.1 million short tons, about the same level as in 2007 and a decrease of 22.4 million short tons from the 2008 level.
U.S. coal exports to China via Northwest ports has been going on for quite some time. The fact that shipments are going to increase has also been widely reported in recent months.
Canada sends most of its coal to the Orient, and has for years, and is expanding port facilities to send vast amounts more. Is anyone pretending this market doesn’t exist? Everyone is sending ''stuff ‘’ to China.
Some folks think this is The Next Big Thing.
China needs to consistantly increase production of electricity to keep their economy growing and the population happy/under control. There is coal in China, but from what I read the mines are largely small and inefficient. More importantly, China lacks the transportation infrastructure to move the additional coal.
Chinese economic development has been concentrated near their Pacific Coast. This means coal arriving by ship can meet the needs of economic development while placing less strain on their limiting transportation infrastructure than other options. Ocean shipping is very low cost.
The US, in contrast, has the most extensive, most efficient rail freight system in the world. I’m sure China can buy service to the ports on the US system much cheaper than they can develop their own rail network.
What rumours? This has been fact as seen in professional rail and energy media as well as fan media for years. Nothing new. Increaseing as was predicted and reported for years.
Hi Overall,
If you are able, I sugest you get a copy of TRAINS Magazine dated April this year. It is a highly informative and interesting issue mainly devoted to the subject of coal. You will be able to read where, in the United States to coal is mined, the quantities and types and where it is shipped to. It is well worth obtaining.
Well, as John Kneiling would have said -
“That’s what colonies do - extract the raw materials from the ground, ship it back to the Motherland for use/ processing/ refining/ manufacturing, etc., and then get finished goods back in return, paying for those with the money they earned by selling the raw materials”.
[:-,] Oh, wait . . . in this scenario, that would make the US the ‘colony’, and China the ‘Motherland’ . . . [:-^]
More pragmatically, if they’re acting in an economically rational manner, the Chinese are going to buy their coal of the needed quality from wherever and whoever can get it to their point of consumption for the cheapest price per Million British Thermal Units, with all factors considered. Note that since neither the sources nor the users of coal are evenly distributed or near to each other, there are going to be some seemingly odd arrangements occurring as the bu