North America Coal Strategic Planning Outlook - H1 2023
In the near term, domestic demand for thermal coal starts to drop more quickly than supply as coal-fired generation faces tough competition from low-price natural gas. With Henry Hub prices below US$3/mmbtu, coal-to-gas switching results in a year-over-year 15% decline in coal burn in 2023. Total production is slower to respond, and the net effect is a rapid turnaround from depleted to abundant EGU stockpiles. Over time, the supply-demand gap narrows with producers responding to lower demand. Stockpile withdrawals return after 2025, but at a more modest rate.