Peabody has moved test shipments of Powder River Basin coal from Wyoming to Vietnam through Mexico's Port of Guaymas, opening a Pacific export route that bypasses the West Coast coal terminals Wyoming producers have spent years failing to build. Coal from the company's North Antelope Rochelle Mine traveled on Union Pacific's network to Nogales, Arizona, where it was handed to Mexican railroad Ferromex for the final run to the port in Sonora. From there it was loaded onto a Panamax-sized vessel and shipped to Vietnam, which Peabody told investors at the Jefferies Global Industrials Conference arrived on time and to specification.
The move demonstrates that the route works, not that it is commercially viable. Union Pacific and Peabody have described the shipments as a feasibility test, and the railroad says future runs will depend on market conditions. North Antelope Rochelle, about 65 miles south of Gillette, produced 65 million short tons of coal in 2025 and is served by both Union Pacific and BNSF. Union Pacific has also been investing in battery-electric locomotives across its wider network.
Guaymas Handled Less Cargo in 2025 Than Its Own Operating Plan
Port capacity is the first open question. Mexico's port authority ASIPONA recorded 5.01 million tonnes of total cargo at Guaymas in 2025, down 5% from 5.25 million tonnes in 2024 and roughly 35% short of the port's own operating plan of 7.65 million tonnes. Its commercial handbook advertises total operating capacity of 14.2 million tonnes, a port-wide figure covering all cargo types, not a coal-specific one, and it lists no dedicated coal terminal. Modernization projects covering mineral storage and a new multipurpose quay are underway, though the port has not published completion dates or coal-specific capacity targets.
A pilot shipment proves rail and port compatibility, but it says nothing about repeat capability. Recurring unit trains and ocean vessels require reliable unloading, storage, dust control and berth availability well beyond what one test run demonstrates.
Vietnam's Import Growth Is Slowing Inside a Shrinking Global Market
Vietnam is a real, growing buyer, part of the wider shift in where global coal demand is now concentrated. The country imported a record 65.43 million tonnes of coal in 2025, up 2.6% from 2024's previous record, according to Vietnamese customs data reported by Argus. While the global seaborne market actually expanded in 2025, Vietnam and South Korea stood out as primary growth drivers in specific commodity segments, such as seaborne thermal coal, where they bucked the localized import reductions seen in China and India.
The broader contraction is the harder part of the story. It follows a pattern already visible in China's own coal-buying swings over the past two years. Reuters reported Kpler trade data showing global thermal coal exports fell roughly 5% in 2025, the first annual decline since 2020, as China's imports dropped about 12% and India's fell nearly 3%, both driven by rising domestic production. Indonesia and Australia already serve Vietnam with shorter shipping distances than Wyoming coal routed through Mexico, and Peabody has not disclosed a delivered cost, a contract beyond this trial, or a shipment frequency showing the route can compete on price rather than novelty.
Peabody says it is evaluating a second Guaymas test, separate from a planned Oakland, California terminal not expected to operate until late 2028. Neither company has said what would need to change, in rail capacity, port investment or coal pricing, to turn this trial into a recurring trade lane.
