An industry survey estimated that US thermal coal output and demand increased in June following shutdowns caused by the COVID-19 pandemic in March and April. US thermal production has improved from May to June. Hence, the survey forecast that total US thermal production would be about 620 million short tons in 2020.
Meanwhile, demand from domestic utilities in June remained 15% below the consumption in the same month last year but improved from a 30% year-on-year drop in May. These utilities have also deferred deliveries in the second quarter. These delayed deliveries will have to be made up in the third and fourth quarters because some of them are under annual supply deals.
However, the rising production alongside lower coal burn in power generation has boosted stocks. According to the study, inventories were estimated at 153 million short tons as of June 18, a surplus of 48 million short tons from the same period last year.
