Price Increase for Coal? Maybe not.

chabbo wrote:despite the 100% price increase coal has experienced over the past year according to my dealer

That's not true, the price right now locally is $130+/- a ton at the breaker, this is the exact amount it was last fall. I forget but probably $5+/- more than it was last spring/summer. For any significant price increase you'd have to go back to when Katrina hit where it rose a whopping $10 - $15 over summer prices. It's probably risen roughly about $40 since 2000, mostly due to the increased price of fuel.

Going back to my records from 1985 the cost of ton delivered locally was $80. According to the inflation calculator that equals $157 today which is actually slightly more than what it would cost to get a ton delivered today. Anthracite coal prices have always been historically stable, with small yearly increases. This winter will be the real test to see if it can maintain that.

I bought a new stove yesterday so get ready for the prices to go through the roof. I'm sure it will be at least $1500 a ton by September. Chris

Coal is a real bargain. One ton is approximately equal to 180 gallons of oil. At 4.25 a gallon that $765.00. Coal takes a little work and a few minutes of time every day. To me that's worth the extra work.

Richard S.:

My dealer from Western Massachusetts told me yesterday that last year he was selling coal for $130 per ton, and this year he is charging $260 per ton. That is the basis of my previous statement that the cost of coal has increased 100% over the past year. I gather from your comments that long term coal users closer to the suppliers have experienced more modest increases in coal prices than those that have to have it shipped a good distance. If that is true, then the 100% increase in coal prices in Western Massachusetts over the past year would be due primarily if not exclusively to the increase in trucking transportation costs. Either that or my dealer is misinformed or mistaken.

If indeed increased transportation costs is such a significant component of coal prices in Western Massachusetts and distant areas from the breakers, then coal prices will continue to follow the added costs of transporting that coal to distant areas, namely, diesel (heating oil #2). If oil continues to rise, then coal prices will have to continue to rise even if there were no increase in demand (which we all know there will be an increase in demand). To get to my initial question, the more I think about it, the more I come to the conclusion that stockpiling coal at these prices might be the more prudent way to go to hedge against any further increases in coal prices that may come from increases in oil prices (transportation costs) over the next 2-3 years.

Thank you for your comments.

Manny

Hi Manny,, I can't see how your dealer could have sold coal for $130 a ton last year,, the Least expensive coal was around $110-120 and he still had transportation costs to add in... I think he's embellishing a bit...

Check out the coal discussions forum.. there are some guys in Maine getting coal for around $210 delivered,, so you should be able to do similar.

Greg L.

As mentioned it would not be possible for your dealer to provide prices like that last year unless he had it stocked from many years ago. You couldn't even get delivered for that price here last year from most places. The dealer cost is lower than what the consumer is going to pay at the breaker but its not that much lower. Normally retail has a 50% markup for most products but if that was the case with coal I'd be down on my yacht in the Bahamas right now sipping a margarita. Frankly I'd think you'd be surprised how little it actually is.

Be sure to find out that it is in fact anthracite you're getting, he would be able to sell bituminous for that price. Also note you cannot burn bit. coal in a standard EFM stoker.

chabbo wrote: My dealer from Western Massachusetts told me yesterday that last year he was selling coal for $130 per ton, and this year he is charging $260 per ton.

He was probably getting $230 a ton, a fairly reasonable price for Mass.

Thanks everyone for their thoughts. Perhaps I misunderstood him. Your comments make me feel better that coal prices should not have the percentage increases that we have experienced in oil. I do think I will still get 2-3 years stockpiled at these prices. I don't think coal prices will come down much if at all during that timeframe given what I expect for oil prices.

Thanks again.

Manny

I am new to this, and have not yet installed my Nashua Mark I into my fireplace here in this 90 degree weather in Rhode Island; but from the tone of this discussion, one might get the impression that one should stock up on coal now, rather than wait till August or September. My question is: Do I really have anything to worry about with coal prices, seeing as how the U.S. sits upon one of the biggest sources in the world? Cranston Coal sells at $230 per ton presently...should I order now?
Sincerely, Danno

I live in CT and the price of coal has risen slightly every year for the last 25 years. Usually $5-10 a year, I would expect due to fuel prices skyrocketing, that number may double. It's at $230-240 now on average around here. Stocking up is good, buying in bulk is best. I don't like fooling with it when it is cold, with ice and snow everywhere.

Bulk rules, I have 22.5 ton coming at the end of June. Stoker boiler and stove being installed in July. If I can scrape up the
$$, I will put a stoker stove in shop too. I am going all coal all the time. As far as pricing, 190 ton delivered. Got prices
close to this and way more. As far as quality, mixed, and ash content checked. Pricing is stable, diesel increases seem to be the variable.
Every thing old is new again.