uploads///Part  coal prices

Powder River Basin Coal Breaks the $10 Barrier: Will It Stay Up?

Mike Sonnenberg - Author

Dec. 4 2020, Updated 10:52 a.m. ET

Powder River Basin coal

PRB (Powder River Basin) spot coal prices averaged $10.55 per ton for the week ended July 24. That’s $0.67 higher than the price for the week ended July 17. PRB coal prices averaged above $10 a ton for the first time in the last five weeks.

The Powder River Basin is the largest coal-producing region in the United States. It’s located in Wyoming and Montana. PRB produces almost half of the total US coal output. It’s also the lowest-cost thermal coal-producing region in the world.

Peabody Energy (BTU), Arch Coal (ACI), and Cloud Peak Energy (CLD) are major coal producers (KOL) that operate in this region. Despite the increase, PRB coal still remains relatively low. Weak prices for PRB coal don’t bode well for these producers.

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Illinois Basin

The ILB (Illinois Basin) is located in Illinois, Ohio, and Western Kentucky. The basin produces high-sulfur coal. In recent years, ILB coal became competitive with coal from the neighboring Appalachian region, as power plants installed scrubbers to soak sulfur, which causes acid rain. Peabody Energy and Alliance Resource Partners (ARLP) are major players that operate in the region.

ILB coal prices remained at $34.35 for the second consecutive week, a multi-year low.


The Appalachian region is located in the Eastern United States and is the oldest coal-producing region in the country. This region is affected the most by natural gas price movements. However, because Appalachian coal prices are already down to marginal costs, they now show a reduced correlation with natural gas prices.

Central Appalachian and North Appalachian thermal coal prices remained steady at $43.13 and $53.2 per ton, respectively.


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