Baltimore Port Shutdown Triggers Coal Price Hike: Energy Information Administration Warns Of Export Disruptions

CONSOL Energy Inc +4.05%
Range Global Coal Index ETF +1.17%
Ishares U.S. Basic Materials ETF -0.55%

CONSOL Energy Inc

CEIX

88.40

+4.05%

Range Global Coal Index ETF

COAL

23.53

+1.17%

Ishares U.S. Basic Materials ETF

IYM

142.27

-0.55%

Coal prices have risen in the past couple of days since the Port of Baltimore was closed following the collapse of the Francis Scott Key Bridge, cutting off many of the port’s facilities.

The price of a ton of U.S. coal rose by 0.6% on Thursday to $113.25. Meanwhile, the Range Global Coal ETF (NYSE:COAL), which tracks several different miners of differing grades of coal, rose 0.7% to $22.81, and is up 2.7% over the last two trading sessions.

Consol Energy Inc (NYSE:CEIX) is one of the biggest exporters through the port’s coal terminal. The Pennsylvania-based company said following the incident that it was working with port authorities to restore access to the terminal.

It added, however: “At this moment, we do not have a definitive timeline of when vessel access or normal operations will resume. We are looking at all available options to us to minimize or address direct and indirect impacts to the Company and its operations.”

Consol’s shares fell nearly 7% on Tuesday, but recovered some ground in subsequent sessions.

Also Read: Tesla, GM, Ford Supply Chain Concerns: Baltimore Port Closure ‘Going To Have An Impact’

Coal Export Hub

The U.S. Energy Information Administration (EIA) said the port is the second-largest coal exporting hub in the country, accounting for 28% of total coal exports in 2023. Much of this is delivered to Asia.

The EIA warned: “The interruption in operations in Baltimore may affect the volume of exports this year.”

Baltimore’s coal terminal is attractively situated to receive coal from the northern Appalachia fields in western Pennsylvania and northern West Virginia, which produce both premium quality metallurgical for steel production and smelting, and steam coal for use in power stations.

Shipments of the predominant steam coal from Baltimore averaged 12 million tons between 2019-22, but surged to 19 million in 2023 after rising demand from Asia, particularly India.

The EIA concluded: “Other nearby ports, most notably Hampton Roads, have additional capacity to export coal, although factors including coal quality, pricing, and scheduling will affect how easily companies can switch to exporting from another port.”

Metal Imports

Baltimore is not only a hub for exporting commodities, it is also a key destination for U.S. imports, with cobalt among the metals — with over half of total shipments arriving in Baltimore.

In addition, Baltimore was the third-largest destination for imports of unwrought primary aluminum last year.

On commodity exchanges, the price of aluminum futures rose 2% on Thursday as the market faced supply chain glitches. The iShares U.S. Basic Materials ETF (NYSE:IYM), which tracks producers of metals and other raw materials, has gained 2.1% over the past couple of session.

Meanwhile, shipments of tin, copper and zinc are also expected to face delays as other ports are found to receive the extra capacity.

Now Read: Baltimore Bridge: Ship Collisions Not Uncommon — 5 More US Fatal Accidents

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