ARLP - US coal prices top $100 for first time since 2008
Central Appalachia coal prices surged to $106/t last week, the highest level since 2008; Illinois prices rose to $109/t, a new record for the basin. Seaborne thermal coal prices traded above $400/t in early March, as natural gas scarcity in Europe drove utilities globally to switch from gas to coal, before drifting lower to ~$250/t currently. Over the weekend, German politicians indicated the country could rely on coal for power in the event Russian gas became unavailable, while France's Macron called for sanctions on Russian coal exports. US thermal coal producers contract with utilities on a 12-24m forward basis, and realizations have been below $50/t for most US producers for several years; improved domestic spot prices could support contract price realizations in 2023 and beyond. With coal stocks trading at historically low valuations, and thermal coal prices rising faster than nearly all competing forms of energy in 2022, names like
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US coal prices top $100 for first time since 2008