Peabody lowers 2026 PRB coal outlook by 7.5mn st

Spanish Market: Coal, Coking coal, Electricity
04/11/26

US coal producer Peabody Energy cut targets for its 2026 Powder River basin (PRB) and other US thermal coal sales in reaction to "mixed" domestic market fundamentals.

Peabody now expects to ship 76.5mn-78.5mn short tons (69.4mn-71.2mn metric tonnes) of PRB coal, down from a previous forecast of 82mn-88mn st. The company also narrowed expectations for its western bituminous and Illinois basin sales to 13.3mn-13.7mn st from previously expected 13.2mn-14.2mn st.

"US thermal fundamentals are more mixed, but coal continues to provide reliable supply of electricity during periods of high demand," chief executive Jim Grech said.

The company reported today that its 2026 US thermal coal sales have been challenged by lower-than-anticipated coal burn during the third quarter that may have prompted some customers to defer shipments. The amount of PRB coal the company has priced and is under contract to ship this year has fallen to 78.5mn st from 80.8mn st priced around the time of the company's second quarter earnings discussion.

"We'd expect our contract position from this year to roll into next year, probably with an expectation of a few additional tons in the PRB and similar volumes in the other segment," Peabody's chief marketing officer Malcolm Roberts noted.

Peabody missed its internal US thermal coal sales targets in the third quarter, with PRB sales falling to 19.6mn st from 22.6mn st a year earlier. The company sold 3.4mn st of other US thermal coal during the quarter, down from 3.7mn st a year earlier.

In July, Peabody had projected it would ship about 22mn st from its PRB mines over July-September and 3.7mn st from its other US thermal properties.

The company's per ton revenues and costs for its PRB segment rose to $13.71/st and $12.94/st, respectively, from $13.36/st and $11.07/st at least partly because of lower sales volumes. Higher diesel prices also affected PRB coal operations.

The producer raised expected 2026 PRB coal production costs to $13-$13.50/st from $12-$12.50/st. The per ton price for PRB coal under contract also edged up to $13.70/st from the previous $13.65/st.

The company also has 13.7mn st of other US thermal coal under contract for this year and priced at an average $57.50/st, up from 13.6mn st and $56.70/st in July.

This quarter, company PRB shipments should be around 19.50mn-21.5mn st and other US thermal coal at 3.6mn-4mn st, Peabody said. In the final three months of 2025, the company shipped 22.3mn st of PRB coal and 3.7mn st of other US thermal coal.

Grech said that Peabody is also evaluating opportunities to pair mine-mouth generation with data centers. There is a lot of interest in mine-mouth generation in Wyoming, he added, but Peabody is still in the early stages of discussions with potential partners.

"Our approach remains capital light and partnership driven, positioning us for new revenue streams and long-term growth," Grech noted.

Peabody's seaborne coal segment sales were mixed last quarter when compared with a year earlier. Its Australian thermal coal exports fell to 2mn st from 2.8mn st and domestic shipments from Australian mines dropped to 1.1mn st from 1.3mn st. But the company's metallurgical coal sales increased to 2.2mn st from 2.1mn st.

Peabody shipped 580,000st of hard coking coal from the Centurion mine in Australia last quarter. But faulting and ground conditions around the mine's longwall operations constrained late-quarter production at the mine and limited October output. As a result, Peabody revised its fourth-quarter sales guidance for the mine to 300,000–500,000st.

The company expects its overall seaborne metallurgical coal sales to fall to 2.2mn-2.4mn st this quarter from 2.5mn st in the same period of 2025. The company's Australian thermal coal shipments are expected to rise to 3.6mn-3.8 mn st from 3.3mn st, with exports increasing to about 2.5mn-2.7mn st from 2.1mn st.

Otherwise, the company mostly maintained the 2026 outlook for its seaborne coal operations, saying it expects to ship 12.7mn-12.9mn st of Australian thermal coal and 8.3mn-8.5mn st of coking coal.

By Elena Vasilyeva

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12/11/26

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12/11/26

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12/11/26

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