The big bright spot for U.S. coal miners is located halfway around the world. India almost tripled its imports of the rock from America in the first quarter from a year earlier, helping fuel its fast-growing economy and making it the largest foreign buyer of U.S. coal, according to the U.S. Energy Information Administration.
The South Asian nation is extending a lifeline to U.S. miners who are struggling to find buyers at home as cheap natural gas and renewable energy continue to force coal-fired power plants into retirement. Miners are increasingly relying on overseas sales to maintain — or at least slow the decline in — production levels.
The U.S. may export 104 million tons of coal in 2018, up 7.2 percent from a year ago, the EIA forecast in its July Short-Term Energy Outlook published Tuesday. Through April, India had brought in almost 7 million tons, approaching a fifth of all U.S. exports of the fossil fuel. The next largest customers included South Korea, Japan, Brazil and the Netherlands.
India’s appetite for foreign coal is increasing at a time when the country’s own production of thermal coal is struggling to keep up with the fast-growing demand from its power sector, according to the EIA.
What’s more, it’ll probably drive most of the global growth in metallurgical coal demand in coming years as India tries to meet ambitious steel-capacity goals, Mark Levin, an analyst at Seaport Global Securities LLC, said in a note Tuesday.
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