US port sees increasing coal traffic as seaborne market booms

Feb10,2011
The heavy traffic may be the new normal, industry officials said.Just weeks after fourth quarter conference calls during which Appalachian coal producers talked about the pull of Asian markets on US coal supplies, Adam Anderson, executive vice president for booking agent T. Parker Host, expects ship traffic to remain heavier for at least the next six months.After shipping 1.54 million st of export-bound coal in January, Norfolk Southern's Lambert Point pier is expected to alone load 1.95 million st of coal onto 32 ships between now and March 5, according to T. Parker Host.

Neighboring Dominion Terminal Associates and Pier XI are slated to receive a combined 37 ships with capacity for 2.2 million st during the same period, the company said.The US export market has experienced building pressure from the market gap left by Australian suppliers crippled by flooding and a recent typhoon, but the larger factor driving traffic in Norfolk is the pull from Asian steelmakers seeking coal for their furnaces, Anderson said."Even without Australia, we'd still be pretty busy. I think the big change now [is before] you had the domestic market and Europe or Brazil -- you sold it to one of those markets or it stayed in the ground," Anderson said."[Now], we sell it to our natural market or sell it to Asia. I think that's a big change."CSX told investors in January that it could haul between 35 million and 40 million st for export shipments during 2011, nearly double what it did in 2009; Norfolk Southern executives said the Lambert's Point docks could handle 30 million st compared with 16.7 million mt. But a major concern for the coal suppliers, customers and terminal operators has been transporting coal from mines to the coast.Transportation capacity on the two railroads, particularly on Norfolk

Southern, has remained a concern for coal companies, their customers and the docks themselves. Norfolk Southern executives acknowledging poor service dogged its fourth quarter performance and results, but pledged that additional cars and employees were being added to address the issue.At this point, though, trains keep coming and Anderson sees no let up in traffic anytime soon."There's so much business and both the railroads are adding people and cars to keep up with demand," he said. "We don't see any decrease." (Source: Platts)