Thursday, April 05, 2018

Trump's impact on the coal industry, which he vowed to revive, has been largely psychological and financial

President Trump pledged to revive the ailing coal industry from the start, but has he? He fulfilled most of the items on the wish list of coal magnate and financial supporter Robert Murray, but while industry numbers have improved somewhat, "No one is naïve enough to think that coal will return anytime soon to its glory days, when it fueled more than half of the nation’s electricity generation, employment reflected robust production and coal was fetching high prices in overseas steelmaking centers," Michael Collins reports for USA Today.

The numbers say Trump hasn't moved the needle much, and most gains weren't because of policy change: There are 1,300 more coal jobs than when Trump took office, and coal production in 2017 went up to 774 million tons, a 6 percent gain over 2016. But the increase in production is mostly because of lower production costs, which happened because several major coal companies went bankrupt and restructured, Collins reports.

Meanwhile, coal consumption fell slightly, to 717 million tons in 2017. "Even more alarming for the industry: Almost all domestic coal consumption is in the power sector, yet despite an increase in natural-gas prices in 2017, coal’s share of power generation for the year was just 30 percent, the lowest on record and lower than natural gas for the second year in a row," Collins reports. Coal exports increased 61 percent from 2016, but analysts say the bump is short-lived and caused by international market factors.

Coal-industry insiders say those numbers don't tell the whole story, and insist Trump has helped because he made miners and financiers feel more hopeful about the future and jettisoned regulations that hampered the industry. "It has given the industry and investors the assurance that at least their government is not going to discourage production and we only have to deal with the marketplace," Luke Popovich, spokesman for the National Mining Association, told Collins. "Instead of having to fight natural gas, subsidized renewals and our own government, now we are at least free to compete in the marketplace. That has been the big change as far as we’re concerned."

Terry Headley of the American Coal Council said the job numbers don't reflect the fact that some miners have returned to work as contractors, "or that contractors who work as suppliers also are back on the job," Collins reports.

At least one hard-hit coal area has seen some recovery since Trump became president: Coal jobs in West Virginia rose more than 15 percent in 2017. Several local leaders in coal country told Collins that many coalfield residents believe Trump is responsible for any industry gains, and they think coal is stable and will be for a while. But they don't think it will boom again.

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