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Powder River Basin Coal Prices Fall below $10 per Ton: Who Loses?



Powder River Basin

PRB (Powder River Basin) spot coal prices averaged $9.93 per ton for the week ending June 26—a $0.32 fall from the week of June 19. PRB coal prices have remained under pressure since the start of the year due to low natural gas prices. The fall comes after three weeks of a steady rise in PRB coal prices after hitting $9.90 per ton for the week ending May 29.

The PRB is located in Wyoming and Montana. It’s the largest coal producing region in the US. It produces almost half of the total US coal output. The PRB is 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 the region. Lower prices in the PRB don’t bode well these producers.

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Illinois Basin

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

ILB coal prices remained steady at $40.45 per ton during the week of June 26.


The Appalachian region is located in the eastern US. It’s the oldest coal producing region in the country. It’s affected the most by natural gas price movements. However, because Appalachian coal prices are already down to marginal costs, they show a reduced correlation with natural gas prices.

Central Appalachian thermal coal prices continued to slide downwards. Central Appalachian thermal coal prices came in at $40.75 per ton during the week ending June 26—down $0.38 from the previous week. North Appalachian coal prices remained stable at $58.75 per ton for the fourth straight week.


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