Europe knows US can mine coal, but can it deliver?

By Jacqueline Cowhig and Bruce Nichols

LONDON/HOUSTON, Dec 7 (Reuters) - A potential boom in U.S. coal exports to Europe could slow if bottlenecks at U.S. railroads and ports hinder deliveries, sources on both sides of the Atlantic said this week.

"Everybody's talking some very big numbers for U.S. coal exports, but there seem to be be real problems with the logistics - rail and port capacity," said one European trader. "I think it remains to be seen how much can actually find its way to the European market next year."

A source at a U.S. coal producer agreed rail and port operators face challenges fulfilling export contracts.

"Port and rail capacity is currently very tight," he said. "Railroads are struggling with current volumes and are attempting to increase capacity. It would be very difficult to have a sudden surge in volume. A slow gradual increase may be possible if pricing remains strong."

A spokesman for CSX Corp (CSX.N), a large operator of rail and export terminal capacity, said concerns are misplaced because adjustments have been made that will satisfy demand.

"We really have adequate capacity to handle these things," spokesman Garrick Francis said.

European buyers were not as confident.

"U.S. railroads are notoriously fickle," said one European market source. "If I was a buyer in Europe, I'd be a bit concerned about delivery."