The costs of production for coal are largely cyclical and determined by market forces, as many of them (natural gas, for example) are commodity goods. This, combined with the cyclical and unpredictable nature of coal pricing means that overall coal profitability is largely a function of luck.
Government environmental regulations, if continued, could put a cap on the amount of coal possible for Arch Coal to sell, as well as create conditions for higher-cost coal production and lower profit margins.
Commodity cycles put coal prices largely out of Arch Coal's hands, making profitability largely a factor of the market and, thus, highly unpredictable.;