North American coal markets: contracting and deliveries in 2019

In 2018, coal-fired electric generating units (EGU) remained cautious in their contracted positions, opting for as much volume variability as possible and keeping most contracts to 12 months or less. This resulted in stockpiles falling by 25 Mst (20%) by the end of 2018. The situation as we enter 2019 is quite different, stockpiles are at their lowest levels in 10 years and transportation delays have shown the value of security of supply. Therefore, new contracts with first deliveries beginning in 2019 reveal that EGUs are more willing to enter long-term contracts than in recent years. Also, coal delivered to EGUs via existing contracts longer than a year began increasing as a percentage of monthly deliveries in 2018.