As negotiations on a contract for the supply of coal to the US domestic market for 2026 come to an end, the settlement level indicates that the year will be difficult for US mining companies, many of which have already reduced production this year at high costs.
Alpha Metallurgical Resources lost about 3.6 million tons (tons) of met grade coal for shipment to domestic consumers at an average price of $136.75 per ton, which is about 3.7 million tons lower than the average estimated price of $152.51 per ton last year. In the third quarter, the company recorded the cost of selling MET coal at $97.27 per ton, which is $2.79 less than in the previous quarter. But it still meant a net loss of $5.5 million per tonne in the third quarter of this year.
Calculations for domestic contracts for the supply of low-volatility coal in the United States were set at $140 per ton in 2026, which is about $10-15 lower than last year, due to limited availability, which supported prices. But taking into account the fact that up to 9 million tons of high-volatility coal will be brought to the market next year, domestic prices for high-volatility coal have fallen by about 15-20 dollars per ton, market participants estimated.
The difficult price environment in the marine market has led to more and more manufacturers in the United States seeking to increase their share of sales in the domestic market. However, given that domestic coal consumption was expected to remain largely stable in 2026, not all producers were able to achieve this goal. "Most people will be happy with the increase in production next year, but you will certainly see more miners fighting for a bigger piece of the pie," said one trader.
The competitive nature of internal negotiations this year led to Warrior Met Coal, which usually focuses on the offshore market, recently selling several holds on a trial basis to a local buyer in the United States. But this shouldn't come as a surprise, as Warrior is going to start operations next year at its Blue Creek Stream plant with a reported capacity of 6 million tons per year, bringing the total capacity of the enterprise to 14 million tons per year.
European factories are in the midst of negotiating contracts with the United States, and they are also eyeing these settlements, hoping to get discounts compared to last year. In Northwest Europe, many plants have announced plans to increase steel production next year. This is due to the hope that the introduction of Carbon Emissions Regulation Mechanism (CBAM) rules will support domestic steel demand, while other countries are increasing steel production to maintain their carbon emission standards for 2027.
But from the manufacturers' side
