Demand from China, other nations has greatly boosted U.S. coal prices in the last three months

"Surging demand for coal in Asia is bringing good news all the way to the U.S. coal miners of Appalachia," reports Matthew Dalton of Dow Jones Newswires. "Coal prices in the U.S. have surged 20 percent in the last three months, due largely to the voracious appetite of China and India for coal to generate electricity and make steel. Rising Asian coal consumption has caused European and South American coal consumers, which have relied heavily on coal from South Africa and Asia, to seek out U.S. coal companies for supply."

Jim Thompson, publisher of Coal & Energy Price Report, told Dalton, "The impact of Asian demand in the world market has probably increased the price of U.S. coal by $10 per ton in a three-month period. That's a pretty amazing development." Central Appalachian coal shipped by barge is now selling for $55 a ton, up from $44 a ton in August, Dalton reports, adding, "The price of coal for delivery toward the end of 2008 is even higher, approaching $60 per ton."

The market shifts should help James River Coal Co., International Coal Group and Massey Energy Co., Dalton reports. "These companies have seen their profits suffer over the last two years, as raw materials and labor costs have been rising but coal prices remained flat. Mild weather in 2006 and improved coal shipping from railroads allowed U.S. power plants to stockpile large amounts of coal." Massey's stock price is the highest since July 2006. (Read more)