ALEXANDER, W.Va. — West Virginia’s coal history is a cyclical tale of boom-and-bust periods driven by the world’s appetite for the state’s most abundant fossil fuel. Agility and resiliency have carried coal and its closely linked partner, railroading, through periods of prosperity and dispersity. Today in one of the state’s most rural dwellings is a lucrative Alco-hauling short line railroad with its fate tied to the Ukrainian steel industry — the Beech Mountain Railroad.
Known for its two Alco S1 and S2 switchers, as well as an EMD SW7, the 8-mile-long Beech Mountain has a simple purpose: Move empty hoppers from its interchange with short line Appalachia & Ohio Railroad at Alexander to the Carter Roag Coal Co. loadout at Mill Creek, W.Va., load them with coal, and return them to the A&O hand-off. The A&O interchanges the train to CSX Transportation at Grafton, W.Va., which delivers it to seaborne terminals for export.
There are no other customers on the railroad and United Coal, the company that mines the coal, also operates and maintains the short line and its equipment. The railroad has weathered periods of idled operations or infrequent loadings of one train every few months, and also has seen periods with several trains in a 30-day span. Beech Mountain’s success is currently linked to steelmaking as the railroad transports coking coal used in blast furnaces.
United Coal Co. is a U.S. subsidiary of Metinvest, a Ukrainian steelmaker headquartered in Mariupol. Metinvest businesses mine high-quality metallurgical coal at a couple of Appalachian rail locations, like the Beech Mountain, to feed Ukrainian steel mills.
Metinvest’s steel-making assets have been exposed to Russia’s attacks that began in late February. Periods of unrest have caused Metinvest to pull back production at operations in proximity to the war zone, placing some operations into standby, or hot conservation, mode.
In one of Metinvest’s periodic updates on its operations, it said on May 13, that assets in Mariupol and at Avdiivka Coke in Donetsk have been affected by hostilities. The steelmaker has mothballed some assets and began repairing others as the conflict allows.
Metinvest’s position is that the full impact of the Ukrainian war is not yet known and will be dependent on the duration and extent of the conflict, as well as the impact these events have on its assets.
Beech Mountain’s future rests in the crosshairs of the Russia-Ukraine conflict.
United Coal has shifted its coal sales to the U.S. and export customers instead of intracompany sales, according to Metinvest. Coal prices continue reaching unprecedented highs, fueled in part by the war, as production struggles to meet worldwide demand. As a result, United Coal is likely able to find alternative buyers, given favorable spot-market prices.
It’s unclear how long the situation will persist in Ukraine and its implications on the country’s economic landscape. The World Bank suggests that Ukraine’s economy will contract by 45% this year. The country’s seaborne terminals in the Black Sea have been cut off. If the war continues, yhe World Bank forecasts a slow economic recovery and a threat of widespread poverty that could affect up to 30% of the population. Millions have left the country.
A persistent war will have long-lasting consequences in addition to the tragedies already suffered. West Virginia’s backwoods Alco short line could be an indirect casualty.
