Readers will notice a common theme this month in the news section. Coal prices and demand continue to increase. Global markets for both metallurgical and thermal coals are brisk. Demand is high and spot prices are greater than $250 per metric ton (mt) for thermal coal (API) deliveries into Europe and $350/mt for metallurgical coals. Spot prices for U.S. coal consumed domestically from Central Appalachia and the Illinois Basin advanced above the $100/ton level (see News, p. 6).

This market shift comes at a cost. The demand has been brought about by sanctions against Russia and the pressure for other countries to refuse fossil fuels produced by Russia, which includes coal, natural gas and petroleum. While coal operators and drillers would normally celebrate these prices, they know that thousands of people have lost their lives in Ukraine. It’s unfortunate and it doesn’t look like it will end soon.

Energy security has now become a focal point for many countries, especially those in Europe. Europeans face the grim reality that an angry Russia may turn off its gas supply. To move away from Russian natural gas, Europe will need to build liquefied natural gas (LNG) terminals. That will happen and the urgency to do so will only grow. Similarly, the U.S. and other countries will need to invest in LNG export terminals. Once this becomes a reality, more gas will leave the market and the price for natural gas will climb higher.

Similarly, many coal consumers would rather not buy coal from Russia, but they need to keep the lights on and the steel mills operating. To help the world make this transition, substantial investments need to be made in people and resources, and they need to be made now. Many of the coal import and export facilities worldwide require a significant investment to upgrade capacities. In some cases, such as South Africa, the capacity exists, but the rail service to the port is the weak link. To a certain degree, that problem also exists in the U.S. and other coal-producing regions. Some of the profits coal operators and transloading facilities are realizing today should be invested in improving that network.

Central to all this, however, is our greatest resource: people. The industry somehow needs to inspire a younger generation to get involved in this rebuilding effort. Finding people who want to work these days is difficult and finding good people is even harder. The solution is within our grasp, but we need to act quickly.