Despite being the third largest producer of export metallurgical coal, the US has always been known as the “swing producer”. That’s largely because the country’s high-cost producers are more vulnerable to declining coal prices and oversupply.
However, with
the recent downfall of its competitive counterpart Australia, which has been
significantly impacted by royalty changes, the US has become much more comparable.
Additionally, India and China’s strategic diversification strategy has supported the
rise of the US coal in the international arena.
This drastic changeover is evident in trade flows. US metallurgical coal export volume to India soared 80% during Q1 2024. This is significant as the US has a significant
freight disadvantage compared to Australia.
With Russian supply expected to be limited by
sanctions for at least a few more years, AME expects the US will become a vital
producer. We expect the country will export around 41Mt of metallurgical coal
in 2024 and 43Mt in 2025.