January 17, 2018
After year one of the Trump Administration, we can say this about the president’s record so far: despite accusations of favoritism, he has been as generous to the news industry as he has been to corporations.
Especially for scribes in the Beltway Thunder Dome, Trump and his Administration have provided all manner of provocations that became a rich news diet — even as reporters bite the hand that feeds them. For coal, his regulatory re-set and focus on blue-collar, heartland industries dovetailed nicely with a revival in coal demand. No sooner was conventional wisdom reading coal its last rites than prices, production and outlook sprang to life.There’s less contradiction than meets the eye between this conventional view of coal’s demise and the signs of its revival. For those eager to cast any promise made as one broken, it’s easy to seize on coal’s decline from the prior decade when coal generated half of the nation’s electricity. Why report that we’ve stopped the hemorrhaging of coal jobs over the past eight years, however newsworthy, and risk giving the president credit for honoring his promises to help the industry brought low by his predecessor and a merciless market?
But this misses the reasons for the brighter view held by mine operators who survived the past decade. From 2009 through 2016, they endured the retirement of more than 200 coal-based power plants [MSHA], the loss of about 70,000 jobs – roughly half the workforce [MSHA]. Some 800 mines closed [MSHA]. A year ago November, their future looked no better. Few believed public policy would change after the widely expected ordination of Trump’s opponent.
But after an election that surprised most everyone including possibly the winner, the industry’s fortunes and outlook dramatically improved this year. Some CEOs describe a “light switch” effect, darkness turning to light. The back of the hand suddenly became a helping hand.
In Trump’s first year, coal production rose by 6 percent, with most major producing states seeing an increase. In the first three quarters of 2017, coal employment climbed by 11.7 percent. To foreign buyers, U.S. coal became the new black. From January through last November, total coal exports jumped by 67 percent. High value met coal exports rose by 38 percent and steam coal exports more than doubled from the year earlier. Coal shipments to the EU, which we know “doesn’t use coal”, were up 35 percent. Wonder what they’re doing with it?
Critics view coal’s future as daunting – carbon reduction, a market awash in natural gas, renewables on the rise aren’t going away in the new year, they say. But the contrarian view sees coal’s production costs falling, advanced coal technologies developing, more efficient producers thriving, LNG markets opening and EVs rolling.
Judge coal’s current conditions against the administration’s rhetoric after year one and progress may seem wanting. But those behind an industry that survived the past decade to still provide 30 percent of America’s power see light up ahead rather than the darkness of the tunnel.
- On January 17, 2018