Fri, December 9, 2016 4:42 am

The only constant is change. As we say goodbye to 2016 and one of DTC’s greats, we are very aware that change is all around us. However, in this moment we are also aware that change is healthy and we could not be more pleased that the changes happening in the coal industry are lending themselves to a level of optimism not felt for some time. Our thanks to Ted O’Brien for all he has given to DTC over the years and our thanks to all of you who have supported our efforts through thick and thin. Warm Wishes to all in this Holiday Season.~ Team DTC


Major Takeaways:

  1. Supply/Demand Changes: We bumped up 2016 production in all basins to reflect heightened demand and mine output. We also revised up utility coal demand due to rising natgas prices, favorable weather and increased coal burn.
  2. Restarts, New, and Increased Coking Coal Production: Since Jan ’14, we’ve only needed to keep a detailed record of coking coal cutbacks worldwide (registering 69.49 mm MT to date); However, the current seaborne coking coal rally has resulted in so many announcements of restarts, new, and increased production in the past few months that we’re now digging just as deep to track those as well to stay in the front of the pack and to give you that competitive edge.
  3. DTC EIA Revision Estimates: The EIA is expected to release its revisions to Q3 production estimates later this month to match reported MSHA figures. We are currently estimating total US production will be revised downward by 9.38 mm tons.
  4. October Coal Gen Up in ERCOT: The Electric Reliability Corporation of Texas (ERCOT) reported October coal generation up 25.1% YoY, and coal’s share of the generation mix on the ERCOT grid continues to rise off after bottoming out in March.
  5. EPA Cedes the Battle in Texas: The Environmental Protection Agency (EPA) will voluntarily withdraw a contested Regional Haze plan for Texas, and in addition, will remove the state from the annual CSAPR emission allowance trading programs.
  6. Global Producers: We couldn’t sleep at night without making sure we tracked down the Q3 production/earnings/sales reports for the remainder major global players to help keep a bead on what is happening as the markets continue to shift.

DTC On the Road:

We are collecting lots of frequent flyer miles to close the year. This week Hans, Phil, Jack and Geoff travelled with Steve, Parone, and Ted to NYC for the CTA Conference and our DTC Panel Event. Then next week, Sherry Orton and Dianna Ridgway will soak up the sun in Orlando at the annual Power Gen Conference. If you plan to be at any of these functions, please stop and say hello- we love hearing from you!