U.S. Coal Companies See Huge Market In China

Originally published on May 30, 2011 6:42 pm
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MELISSA BLOCK, Host:

But as NPR's Zoe Chace explains, it's happening thanks to 21st century China.

ZOE CHACE: China is lousy with coal, as is the U.S. But there are two kinds of coal in this world. There's the coal you use for energy and there's the coal you use to make steel.

(SOUNDBITE OF MACHINERY)

BOB ADAMS: Here comes the coal now.

CHACE: I'm standing at what feels like the top of the world with foreman Bob Adams. We're watching the met coal that's leaving the country. You know when you're driving on the interstate, and you pass a harbor, and you see those crane-like machines towering over you? I'm in one of those at the Port of Baltimore.

ADAMS: See how it's flowing off of the spoon? The boat is upright. He's putting the last tonnage in it now.

(SOUNDBITE OF MACHINERY)

CHACE: All day and some nights, he sits in the garret at the top of the harbor filling ships up with largely met coal. The coal you use to make steel.

LARRY BOBBITT: Look at the view you got. You know, I swear here at nighttime, soon you can sit here and see the city skylights.

CHACE: LarryBob is the last person to see the coal before it goes overseas.

BOBBITT: But most of the time it's all for the same customer. And these days, most of it's China.

CHACE: The export market to China has exploded. What does that mean for LarryBob?

BOBBITT: Seventy-two-hour workweeks. I'm working six days this week, six 12-hour days.

CHACE: CONSOL is the only U.S. coal company that owns its own export terminal, so it's better positioned than almost anyone else to take advantage of a hungry export market.

BOBBITT: I mean you can say we're bucking the trend when the rest of the country has been, like, the job market's been really tough. We've kind of been the exact opposite.

CHACE: David Fridley is a scientist with the China Energy Group at U.C. Berkeley. He's going to explain exactly why China's stimulus package results in unlimited overtime for Baltimore native LarryBob.

DAVID FRIDLEY: Currently only about half of Chinese live in cities. But China is hoping and targeting that within 15 years, by 2025, they will urbanize another 300 million people.

CHACE: Brand new cities, and brand new buildings, and roads and train lines.

FRIDLEY: For essentially the entire population of the United States over the next 15 years.

CHACE: The way that China is going to do this is not so different from what the United States did to urbanize its population.

(SOUNDBITE OF RAGTIME MUSIC)

CHACE: Around the turn of the 20th century, guess how much of the U.S. population lived in cities, about half, same as China today. And what did we do then?

BOB PUSATERI: Coal was used at the turn of the century, for the renaissance here in Pittsburgh, to develop the steel industry.

CHACE: They saw the need in China for massive amounts of met coal, the coal used to make steel, to build these new buildings and they knew that CONSOL's mines could fill that void, as they had 100 years ago easily since CONSOL is the only U.S. coal company that owns its own shipping terminal.

PUSATERI: Those coals were still here. And with Ernie's help, we decided to push them into Asia.

CHACE: And you know China, it moves a lot faster than us.

(SOUNDBITE OF MUSIC)

CHACE: CONSOL went from exporting no coal to China to exporting a lot. And CONSOL is only one of many U.S. companies shipping the majority of U.S. met coal out of West Virginia, around the Cape of Good Hope, into the South China Sea.

(SOUNDBITE OF MACHINERY)

CHACE: But that's not where the story ends. Here's the most surprising part. These days, U.S. coal companies mostly sell coal for energy. It's not really needed to make steel here anymore, because we have at least 100 years worth of old buildings and cars. That's metal we can use for scrap. But in China...

FRIDLEY: And so, whereas we've been junking cars for a century, that's a new phenomenon in China, as well.

CHACE: Scientist David Fridley says because there's little scrap metal in China, in order to fuel this massive industrialization, the country will have to keep taking in large quantities of met coal to make new steel wherever it can get it.

(SOUNDBITE OF A TRAIN)

CHACE: And in large part, it comes in on trains out of Western Pennsylvania to the port in Baltimore, to LarryBob, the last person to see the coal before it's shipped out. And he does think about all those loads headed to China.

BOBBITT: People using the McDonald's drive through, with the cars and all that, I mean it never had that kind of mobility before. So, you know, yeah, we're prospering from it.

CHACE: Zoe Chace, NPR News. Transcript provided by NPR, Copyright NPR.