Why Has Coal Gone up So Much?

Hello Everyone...
As my subject heading suggests, I'd like to know why the price of coal has gone up so much. I'm aware that transportation costs have gone through the roof but why has the actual price of coal gone up almost as quickly and at the same rate as oil? I would think that any coal producer would be afraid of ending this new interest in coal as a heating fuel and keep their prices within the range of most new coal burning people lest they be shied away from the fuel. Doesn't it make more sense to try and keep the lid on it and therefore further renew the public's interest in coal heat?
There's a new heating kid on the block and it's King Coal. So why does it seem like the company owners are cutting their own throat. I could be wrong but it's just my opinion.
What do you think?

Hi boilermaker. I believe that coal is by far the greatest amount of BTU's for the dollar compared to any other heating source.

Even at $300 a ton, I'd be saving HALF on my normal propane bill. I think coal is cheap.

Now as for costs, I'm not sure over what period of time you are watching prices. But I'll try to give a few ideas from my perspective.

First, the cost of fuel, diesel, gasoline, natural gas and propane, and therefore electricity have all gone up. Wages for workers have gone up.
All the mines and mining equipement are OLD. And old stuff is worn and maybe worn out. This raises maintenance costs.

The breaker I went to to buy my bulk coal this fall was OLD. Bandaids and patches on everything.

Nothing but nothing is cheaper than it was ten years ago except my wages compared to buying power or inflation. Only computers and associated parts and pieces [like cell phones] have dropped in price.

I have a farm and harvest hay for horses and cattle. I used to, in a good year cut the fields three times. The third cutting usually yielded about 1/4 of the number of bales of hay compared to the first cutting. The last two years, I couldn't afford to put the fuel in the tractors to do a third cutting, The cost of fuel exceeded the value of of the hay harvested. So I left a lot of 'money' in the fields.

If the cost of coal doesn't rise with the cost of doing business the business loses money and there goes the coal supply.

I remember buying a brand new, fully loaded 4x4 Luxury SUV in 1978 for $8500. It had every option available. I earned $45K in 1978. Today a fully loaded SUV is more than 45K!! And trust me, my yearly income has not gone up as much as the cost of that SUV!! Lets see, 45,000/8500=5.29. 5.29 x $45000= I can only dream!!

Anyway I think coal is cheap, I just wish it wasn't so far away from me.

Merry Christmas.

Greg L

It's a sad state of affairs really. Coal is much cheaper than oil for me. My stove should be paid off in 3 years or so. Therefore, as long as coal stays cheap enough to pay the stove off, I'll be happy. Plus, I'll be able to switch to any other heating method if necessary.

Everything in this world is getting more expensive. The idea of where we'll be in 10 years is almost scary. How much money will I need to save for retirement when I decide to retire in 40 years (at 66)? Or will I even be able to retire in 40 years?

For now, I go with the financial decisions that make the most sense. That's all I can do.

My coal price hasn't changed in 3-4 years.

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As others have said coal is cheap compared to other fuels. What is unique to other heating fuels is you can safely store it long term with out any detrimental effects. This allows you to buy in bulk for a great price. In the off season PA anthracite sells for slightly over $100 a ton at the breaker. Add bulk transportation for 22-25 tons and you have many years of fuel. Call your favorite trucker with a multi-state license, get a quote and you will see how cheap coal is. A better investment than money in the bank. Remember your local coal retailer has a lot of expenses that reflect the retail price premium vs. the breaker price.

Yanche

I recall getting quotes for anthracite pea coal in north central New Jersey back in 1989 or so for $150/ton. I don't recall if that was delivered or not.

I have a book from 1980 or so, "Home Heating with Coal" that states prices from $100/ton to $150/ton delivered.

SO, considering how everything else has gone up in cost over the past 25 years or so, I don't feel coal has really gone up that much at all compared to other things.

I just wish I would get some good anthracite out here in the coal 'no mans land' at any price in bulk.

Chris

My prices have steadily increased each year, overall the cost has probably increased about 40-45% since I started about 15 years ago. Biggest increase I've seen was last year in the fall which of course fell right in line with the price jump for fuel. One thing to note that although the gas prices have fallen the price of diesel has not fallen as much at least in my neck of the woods. BTW I'm charging only a few dollars more now than I was at this time of the year last year.

The cost of fuel has a large influence on the price especially if you are getting it delivered so far away. There's a lot of fuel involved even before it gets on the truck for delivery, loaders etc.

One last thing to note... As I mentioend my prices have steadily increased, anthracite coal prices are not subject to the wild fluctuations that are common to oil.

boilermaker wrote:Hello Everyone...
As my subject heading suggests, I'd like to know why the price of coal has gone up so much. I'm aware that transportation costs have gone through the roof but why has the actual price of coal gone up almost as quickly and at the same rate as oil? I would think that any coal producer would be afraid of ending this new interest in coal as a heating fuel and keep their prices within the range of most new coal burning people lest they be shied away from the fuel. Doesn't it make more sense to try and keep the lid on it and therefore further renew the public's interest in coal heat?
There's a new heating kid on the block and it's King Coal. So why does it seem like the company owners are cutting their own throat. I could be wrong but it's just my opinion.
What do you think?

Well last year I paid $200 per ton picked up in bulk this year the price was $230 per ton in bulk then I switched to a differnt place 20 miles farther and they are $195 and the coal thier seam to burn a lot better also as the old place I was getting it if I didnt add a piece of wood on top of it it would good out in the middle of the night the new place I have no problems haveing it burn 24 hours with out touching it but I just now switched to a stoker from Leisure line the pioneer Le and now burning 30# per day to heat the house to 73 2200' ranch so im real please as paying 195 per ton would make it cost me $100 for the month I know last year the gas company sent me a bill for 800 for gas seeing they didnt come read the meter it been around 40 outside so I know it will start using more when it gets colder but I know I am still saving even with it being $195 per ton next year I plan on buying what I need plus a little in the summer when it cheeper

One last thing to add... coal is just like any other product. The price ultimately is going to be dictated by what the market can bear especially for those of you in areas where there is no competition, like it or not that's just how business works. There' also the old supply and demand, demand for the product is up but there isn't any significant increase in the supply. 5 years ago anyone could have purchased 1000's of tons at this time of year at a very reasonable price, that's simply not true today. At one point they were making space for the stock piles cause they ran out of room...

Anyhow hope Santa brought all of you stocking full of coal and Happy Holidays.

Thank You all! I figured on getting a little something going here. I was please to see that the prices I'm paying aren't that out of line. We have no gas here and oil is the main fuel of choice. To make matter worse, the price is controlled by a local distributor and tends to keep these prices higher than even the surrounding towns.
Following the advice of one of the respondents, I'm going to look into buying a whole load of 22 tons this summer from a concern in PA. I have no problem storing it and would greatly reduce my heating bill further. Previously I heated my home with oil hot air and it would cost me around $1700 this year to do it. However, the price of my coal was a little over $900. I'm not griping by the way. I was just wondering what others felt.
Again, this is a great forum and I totally enjoy it and wish to thank everyone who responded. Let's keep the mines and family businesses open and our houses warm by continuing to burn the fuel of the future - coal.
Doug

I paid $195 per ton with a $90 delivery charge. They can deliver up to 41/2 tons. Works out to $215 a ton. Thats a lot of BTU's for 215 dollars.

Don

$100/ton pickup.

I think it has gone up do to the majur use of it.

If you mean by folks like us, I don't think so. I would guess that coal used for home heating use is less than 1% of all coal mined here. I agree with other posters who said it's due to fuel costs which impacts coal at every point from mining, processing and transporatation. And no doubt there's alittle greed mixed in and some taking advantage of the rising costs of all other energy. It's still a relative bargain for the few folks who are savvy enough to use it for home heating. My neighbors still think I'm crazy, all except my oil man.

Hard Coal for Homes Is Hard to Get January 15, 1981
Coal is not "getting expensive", the price goes up because of its relationship to other fuels that are driven up by market forces (I think we all know about those by now). That price relationship hasn't changed in over 50 years. Home heating is probably the smallest segment of anthracite sales. I'm willing to bet that the water filtration industry uses many times the quantity of coal homowners use for heating.
For perspective, a truckload of topsoil isn't very much less than one with coal.
Coal is cheap.