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Coal Prices Have Been Constant Week-over-Week

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PRB coal prices

The coal prices in the Powder River Basin (or PRB) reached $12.10 per short ton for the week ended December 8, 2017. PRB coal prices have remained steady for the entire month of November.

The PRB region is spread across Wyoming and Montana. The mines are located on the surface producing sub-bituminous coal. PRB the last low-cost coal mining region in the world.

Two main coal (KOL) companies operating in the PRB are Peabody Energy (BTU) and Arch Coal (ARCH). Peabody Energy had exited Chapter 11 bankruptcy protection in April 2017, and Arch Coal emerged from bankruptcy protection in 4Q16.

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Coal prices: Illinois Basin

ILB (Illinois Basin) coal prices settled at $32.60 per short ton when the market closed on December 8, 2017. The ILB coal price has remained at the same figure since the first week of October.

The Illinois Basin produces bituminous coal from coal mines located in Illinois, Ohio, and Western Kentucky. The coal mined from this region is high in sulfur content. The principal players in the ILB region are Natural Resource Partners (NRP) and Alliance Resource Partners (ARLP).

The Appalachian region

For the week ended December 8, 2017, Central Appalachian coal prices came in at $59.85 per short ton. Appalachian region coal prices have remained steady since November, similar to PRB coal prices.

The Appalachian region coal has low sulfur content. The mining practices utilized to mine coal from the Appalachian mines have higher costs than the mining methods used in PRB and ILB. Consequently, multiple coal companies moved their coal-mining operations to the low-cost regions. Nevertheless, CNX Coal Resources (CNXC) maintains coal reserves in this region.

Please drop by Market Realist’s Coal page for ongoing updates.

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