Western Railroad Discussion > More on coal exports

The NY Times has a business section piece today about the world export / import situation for coal. In short, the article contends that increases in demand for electric power in India, Korea, Japan, and China, in particular, will lead to higher exports from every country that has coal to export. The US is mentioned for its supply of Powder River coal.

Coal is cheap, easy to ship, and easy to burn, the article notes. Australia, Colombia, South Africa and the US / Canada have coal available for export. With Mongolia coming on line as a potentially major exporter, its location adjacent to China and near Korea, the demand for coal may shift to metallurgical (coking) coal for steel making. That higher profit product is a US eastern fields specialty.

The article, in my judgement, comes close to being an opinion piece. It takes a strong view that the lull / crash in coal prices in temporary. Given the bloodbath in coal stock prices, the article could be a comfort to many bloodied share owners and workers.


http://www.nytimes.com/2012/11/13/business/energy-environment/china-leads-the-way-as-demand-for-coal-surges-worldwide.html?pagewanted=2&ref=business

Every so often the Mongolia coal story comes up, I think Peabody has some interest there? Anyway, I have often wondered given the infrastructure and the geography, would it be easier to put PRB coal on a train to the PNW and ship to the China coast where most of the population is as opposed to trying to get it from Mongolia?

I know the available ports on the west coast are an issue, but assuming we might get that squared away (I know, I know)?

MWP Wrote:
-------------------------------------------------------
> Every so often the Mongolia coal story comes up, I
> think Peabody has some interest there? Anyway, I
> have often wondered given the infrastructure and
> the geography, would it be easier to put PRB coal
> on a train to the PNW and ship to the China coast
> where most of the population is as opposed to
> trying to get it from Mongolia?
>
> I know the available ports on the west coast are
> an issue, but assuming we might get that squared
> away (I know, I know)?

I believe some of the Canadian coal exported from Roberts Bank goes to China, but I don't know how much, or if there's more capacity at RB

The Chinese government was roundly criticized for putting so much emphasis on high speed rail while coal from Mongolia was being trucked to the power plants. Although there is rail service, it is limited. The new economic plan supposedly calls for significant expansion of the railroad in time to meet the huge coal pits coming on line in Mongolia during 2013-2016.

There was an enormous 10 day traffic blockage in 2010 as coal trucks ran out of fuel, and blocked the main highway. It caused one commissar to lose his job and upped the priority for the railroad expansion.

The emphasis on passenger rail (partly due to the Olympics hysteria) to the detriment of freight remains an enormous bottleneck for Chinese imports of coal.

http://www.theatlantic.com/technology/archive/2010/08/coal-to-blame-for-chinas-epic-traffic-jam/62012/

A note to all that Mongolia, often incorrectly thought of as part of China, is an independent parliamentary republic. Until the collapse of the Soviet Union it was dominated by the USSR. It is bordered by Russia to the north and China to the west, south, and east, and China could probably overrun it in a few hours if it wanted to, but friction between the Russians and Chinese have helped keep it independent.