Considering the number of bankruptcies to hit the coal industry over the past few years, there's a certain irony in the crazy rally that has seen coal prices triple in 2016, yet the industry is still ailing, and moves by one heavy equipment maker even suggest it may have a terminal condition, MSN reported yesterday. Despite the rally in prices this year, the outlook for the coal mining industry remains bleak. In addition to mine closures, new trucking regulations have created delivery backlogs that have caused transportation prices to rise accordingly. The price surge isn't expected to see other miners jump-start currently idled projects. Teck Resources, the largest product of met coal in North America, said that although conditions could see prices remain elevated, this was not some "new normal" for coal. CEO Don Lindsay said, "The management teams will typically not make any significant investment decisions based on a few weeks of prices." That could be why one heavy equipment maker figures now is the time to get out of supplying the coal mining industry with its specialized equipment. Delivering its own quarterly earnings report last week, Caterpillar reiterated that as part of the major restructuring and consolidation of its operations it has been engineering over the past year, it was looking to sell its room and pillar equipment. While Caterpillar may want to sell off its room and pillar mining equipment, there may be others willing to sell into the industry.
