Hefty US Thermal Coal Exports Look Set to Keep Climbing in 2025: Maguire

U.S. exports of coal used in power generation hit 32.6 million short tons from January through November, according to ship-tracking data from Kpler.

That was the highest volume for that period since 2018, and will have generated roughly $4 billion in revenues for the U.S. coal sector, according to price data published by the U.S. Energy Information Administration (EIA).

As thermal coal consumption is being phased out at home due to concerns about pollution, those hefty exports have served to undermine U.S. credibility as a climate leader.

But export volumes could be even higher in 2025 if the incoming fossil fuel-friendly administration of President Donald Trump promotes the extraction and sale of more U.S. energy products as expected.

POLLUTING POWER

Coal is by far the highest polluting fossil fuel, and will generate roughly 10 billion metric tons of carbon dioxide (CO2) globally this year when burned for power, according to Ember.

Roughly 945,000 tons of CO2 is emitted for each terawatt hour (TWh) of electricity produced by coal-fired power stations globally this year.

That compares to around 604,000 tons for each TWh produced by natural gas-fired plants, which is a major reason why U.S. power providers have phased out coal burning and boosted the use of natural gas in power generation over the past decade.

But while U.S. power producers have cut coal’s share of electricity production in half over the past decade to less than 15%, globally power producers remain reliant on coal for over a third of total electricity output.

Several countries – including China, India, the Philippines, Vietnam and Turkey – rely on coal for 40% or more of their generation mix, and must import a fair chunk of their annual coal needs.

GROWTH MARKETS

Indonesia is by far the world’s largest coal exporter, and is on track to ship out over 500 million tons of thermal coal this year, according to Kpler.

But six other countries are also notable thermal coal exporters, with Australia, Russia, South Africa, Colombia, the United States and Canada all on track to export over 10 million tons each this year.

The U.S. ranks sixth on that list, and over the first 11 month of this year has sent a million tons or more to eight different countries.

India is by far the top destination for U.S. coal in 2024, accounting for 9.5 million tons or 29% of total U.S. thermal shipments so far.

Morocco (4.6 million tons), Egypt (4 million tons) and China (3.3 million tons) are the next largest buyers.

Other large buyers include the Netherlands, Japan, Brazil and the Dominican Republic, indicating a wide geographic span for U.S. coal sales so far this year.

And a majority of those markets look set to remain heavy coal consumers for the coming years as energy demand there grows at a faster pace than locally-sourced clean energy supplies.

That means those countries will remain lucrative markets for all coal exporters, including those in the U.S., even if power producers at home continue to dial down their own coal use due to emissions concerns.

The opinions expressed here are those of the author, a market analyst for Reuters.

(Reporting By Gavin Maguire; Editing by Sonali Paul)