Forecast production would decrease in all coal-producing regions, with the largest percentage decrease of 13% occurring in the Appalachian region, it said.

Interior region production, which includes the Illinois Basin, would decline by 8%, the first annual decline for that region since 2009. Western region production would decline by 9%, dropping below 500Mt for the first time since 1998.

US coal production is expected to decline by an additional 29Mt or 3% in 2016.

Interior region production, which accounted for 16% of coal production in 2011, accounts for 21% of production in 2016.

“This increase reflects the region's growing competitive advantages compared with the other coal-producing regions,” the EIA said.

“These factors include the higher heat content of the coal, closer proximity to major markets than coal produced in the Western region, and lower mining costs than Appalachian-produced coal.”

Electric power sector coal stockpiles were 162Mt in September, a 4% increase from August, which is similar to the typical seasonal pattern.

September coal inventories averaged 147Mt during the previous 10 years (2005-14).

Coal stockpiles are still relatively high because of the loss in market share to natural gas for power generation.