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Rail Shipments From January To June Show Bleak Picture For Coal



July 8, 2024 - One of the surest measures of the health of any industry is how much it ships by rail.

Railroads loaded 17 percent fewer cars of coal in the first six months of the year, according to a rail industry trade group.

The Association of American Railroads reports the January to June total is the lowest on record. 

The group says the shift is due to ongoing changes in the energy sector rather than an indication of the broader economy. Railroads transport nearly 70 percent of U.S. coal production.

To be sure, federal data show coal production is down 17 percent year to date. The temporary closure of the coal export terminals in Baltimore may have curtailed some shipments of coal from northern Appalachia.

But coal is increasingly falling out of favor as a fuel to generate electricity, squeezed by both natural gas and renewables. Railroads are turning their attention away from coal and toward consumer goods and petroleum products.

Intermodal shipments by rail are a better indication of the broader economy. Those are up nearly 9 percent year to date. That’s largely consumer goods, the stuff on the shelves in big box stores.