Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, July 22, 1993 TAG: 9307220071
SECTION: BUSINESS PAGE: B5 EDITION: METRO
SOURCE: DANIEL HOWES STAFF WRITER
DATELINE: THE SUMMER OF '93 LENGTH: Medium
A selective coal strike, begun May 10 by the United Mine Workers of America, reached Virginia on July 13, shutting down three CONSOL Inc. mines capable of producing more than 200 railcar loads of coal per day for the railroad.
For now, that's a blip on the screen of a coal marketing division that moved 115.3 million tons of coal - about 1.2 million carloads - in 1992. If the strike is resolved soon, officials expect the shutdown to have scant effect on their coal transportation sales, worth $1.3 billion last year.
But flood waters in the Midwest continue to roil, forcing the railroad to divert traffic and rush to protect portions of its track. Trains of six other railroads have used passable NS tracks throughout the crisis. NS trains have moved along track owned by four other railroads.
Reports of washouts - erosion of roadbeds underneath track - are heightening concerns that flood waters could effectively suspend portions of track and complicate efforts to resume normal operations.
NS crews have used rock to lift a mile-long stretch of track nearly six feet at St. Peters, Mo., west of St. Louis. "Despite that, the water is still lapping up to the edge of the rail," spokesman Robert Auman said With stockpiles depleted by record demand for electricity, some utilities are looking for coal in the so-called "spot market," driving up the price. Wednesday. "We're not out of the water yet."
Since July 12, NS has been operating a round-the-clock work train between Barry, Ill., and East Hannibal, Ill. Fifty carloads of rock and 300 carloads of sand have been brought in to shore up a mile-long levee separating NS track from the Mississippi River.
Indeed, the company's tracks in Hannibal, Mo., have been under water since June 26. The line between the central Missouri town of Moberly and Kansas City has been flooded in parts and is closed, as is the line from Moberly to Decatur, Ill.
Nature's wrath is rippling elsewhere in the economy, too.
The flooding, the strike and skyrocketing temperatures in the Southeast have caused increases in coal prices. With stockpiles depleted by record demand for electricity, some utilities are looking for coal in the so-called "spot market," driving up the price.
Coal that sold in January for $21 to $22 a ton - barely break even for some producers - now is fetching $26 to $27 a ton, said Rafael Villagran, an analyst for Shearson Lehman Brothers Inc.
"Coal prices have gone up," agreed Donald Seale, Norfolk Southern's Roanoke-based assistant vice president for domestic coal sales. "I'm hearing everything from [increases of] $2 per ton up to $5 per ton."
Leading NS coal customers - Duke Power Co. and Carolina Power and Light Co. - have set demand records during the July heat wave, he said, reducing their stockpiles.
"I don't think you could call them thin, but they're down a bit," Seale said.
That's good news to Norfolk Southern and its chief competitor, CSX Transportation Inc. Both love hot summers and cold winters, the better to prompt increased coal orders from utility customers.
Appalachian Power Co., for its part, has "adequate supplies of coal at our power plants," said Dan Carson, vice president for the Roanoke-based utility, which has not increased its coal purchases because of hot weather or the miners' strike.
by CNB