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Rail News: Rail Industry Trends

Peabody cuts PRB coal production projection


Last year, BNSF Railway Co. and Union Pacific Railroad set coal-loading records in the Powder River Basin (PRB). They probably won’t in 2009.

Last week, major PRB coal miner Peabody Energy announced it’s reducing this year’s production targets. The world's largest private coal company expects U.S. production to total between 190 and 195 million tons vs. more than 200 million tons mined last year. PRB volumes are projected to drop by about 10 million tons.

“The Powder River Basin reductions will be concentrated in lower-quality, lower-margin coal products,” Peabody Energy officials said in a prepared statement.

Although the production adjustment is a response to the global economic downturn, the miner “remains confident in the mid- and long-term outlook for coal demand,” officials said.

More than 90 percent of BNSF’s coal traffic and more than 70 percent of UP’s coal traffic originates in the PRB.

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More News from 1/12/2009