Sunday, July 29, 2018

Coal shipments, second quarter

The second quarter of this year was one of recovery for coal on the Ohio River, probably because of export markets.

Here is a chart of selected Ohio River locks and dams and three on the tributaries to show how coal shipments changed from the second quarter of last year to the second quarter of this year.
Coal shipments, second quarter (thousands of tons)
Dam20172018ChangePct. change
Pike Island5,901.193,358.39-2,542.80-43.1%
Lock & Dam 523,242.235,183.321,941.0959.9%
Lock & Dam 2 (Monongahela)2,105.691,628.37-477.32-22.7%
Winfield (Kanawha)1,262.601,510.10247.5019.6%
Kentucky (Tennessee)1,871.901,932.9161.013.3%
Source: U.S. Army Corps of Engineers

Notice the big change on the Lower Ohio. To check things out, here is a graph of how downbound shipments through Locks and Dam 52 were monthly since the beginning of 2017.

Month Tons (thousands)
Jan 2017         759.65
Feb 2017         891.89
Mar 2017         661.32
Apr 2017         383.93
May 2017         758.38
Jun 2017         607.16
Jul 2017         466.54
Aug 2017         714.92
Sep 2017         648.04
Oct 2017         852.81
Nov 2017      1,043.92
Dec 2017      1,260.09
Jan 2018      1,499.92
Feb 2018      1,379.40
Mar 2018      1,421.34
Apr 2017         958.72
May 2018      1,003.47
Jun 2018      1,113.73

Using comparisons for Locks and Dam 52 carries the usual caveats that any of the frequent outages there can slow down movement of any material in a given time frame. Yet it’s easy to see that a lot more coal is heading down the river there, probably for export.

Meanwhile, the news remains mixed on the two sides of the Kanawha River. Coal traffic through the Racine Locks and Dam continues to increase while tonnage through Gallipolis Robert C. Byrd lags and tonnage at Greenup decreases.

Railroads are reporting increased shipments of export coal as domestic use falls. Domestic markets face strong headwinds (to use corporate jargon) as coal-fired power plants are retired or cut back production because of competition from natural gas and renewables.

That’s why I added the Capt. Anthony Meldahl Locks and Dam to this quarter’s list — to see how the shutdown of the Stuart and Killen power stations in the Meldahl pool may have affected movements through Meldahl and Greenup. In recent years, Meldahl had switched from Appalachian coal to Illinois Basin coal. And the retirements of Stuart and Killen had been announced so far in advance that we could expect reduced shipments as Dayton Power & Light managed its stockpiles at the two plants.

Back to the railroads: In the second quarter, CSX reported that it moved almost as much coal to export terminals as it did to domestic customers. Export coal was about 45 percent of all coal hauled for CSX. Domestic volume were down 11 percent in the quarter, while export tonnage was up 39 percent. That helped CSX report a coal volume increase of 6 percent in the quarter.

Export coal accounted for only 26 percent of Norfolk Southern’s coal business in the quarter. Export volumes increased 21 percent in the quarter while domestic utility volumes declined by 5 percent and domestic metallurgical volumes increased by 7 percent. Overall coal volume was up 3 percent in the quarter for Norfolk Southern,

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