U.S. Metallurgical Coal Mining in a State of 'Managed Decline'

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Written by John Egan for IIR News Intelligence (Sugar Land, Texas)

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Summary

The U.S. metallurgical (met) coal market is going through a managed decline, as domestic markets are largely gone and overseas markets are oversupplied and highly competitive. President Donald Trump's upcoming trade visit to China is unlikely to lead to a restoration of U.S. met coal exports to that nation.

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U.S. Metallurgical Coal Market

For much of the 20th century, metallurgical (met) coal was used in U.S. blast furnaces to manufacture steel. But as electric arc steelmaking gradually displaced blast furnaces, met coal mining companies turned to export markets for survival and growth.

According to Industrial Info Resources data, there are 44 capital metallurgical coal mine capital projects in the U.S. valued at about $4 billion. One project, the grassroot Blue Creek Number 1 Underground Metallurgical Coal Mine in Alabama, currently under construction, is scheduled to finish in mid-2026. Subscribers to the Industrial Info Resources Metals & Minerals Project Database can view a detailed project report.

U.S. met coal export volumes have hovered around 50 million short tons per year since 2019. Prices peaked at more than $300 per short ton in 2022, more than double the price in 2019, but they have fallen steadily since then, to an average of about $132 per short ton in 2025, according to data from the U.S. Energy Information Administration (EIA). The agency projected a modest rise in exports this year, to about 57 million short tons, but at softer prices, ranging from $110 to $125 per short ton.

Glutted Global Steel Market Weighs on Met Coal Producers

Global steel production more than doubled in the first two decades of the 21st century, industrializing nations such as China and India increased both their demand and domestic steelmaking capacities. Both nations have abundant supplies of met coal, though, and other exporters, such as Australia and Indonesia, ramped up their met coal exports to chase a limited number of export markets.

High met coal prices plumped the returns of met coal miners such as Warrior Met Coal Incorporated and Alpha Metallurgical Resources Incorporated a few years back as they rode soaring global demand for steelmaking coal.

But more recently, a glutted overseas market and weakened prices have pushed down earnings for some U.S. met coal mining firms. Despite that trend, Warrior Met Coal reported sharp gains in first-quarter profitability and met coal shipments as its Blue Creek Mine drove record sales volumes and margin expansion, the company said April 30 in its reporting earnings. First-quarter net income reached $72.3 million, a reversal from a year-earlier loss of $8.2 million.

But the news wasn't quite as positive for Alpha Metallurgical Resources: first-quarter losses were cut to $11 million from $34 million for the year-earlier quarter on higher realized prices in the just-ended quarter despite a slight decline in sales volumes: to 3.6 million compared to 3.8 million for the January-March 2025 period.

Core Natural Resources, Incorporated, created in January 2025 with the merger of CONSOL Energy and Arch Resources, said first-quarter volumes and margins for met coal improved over year-earlier quarter. In reporting its results on May 7, the company said, "While global economic uncertainty has weighed on metallurgical markets in recent months, the ongoing rationalization of high-cost supply, coupled with the after-effects of weather-related disruptions in Australia, continue to provide a level of support to these markets, while at the same time highlighting the fragility of the global supply chain. Looking ahead, Core expects the ongoing, steel-dependent build-out of Southeast Asian economies--along with sustained investment in new blast furnace capacity across that region--to support a constructive, long-term market outlook for high-quality coking coals."

"Foreign government subsidies and other market-distorting policies have resulted in massive global steel over capacity, which distorts the global steel market and steel trade," said the American Iron and Steel Institute (AISI) in its most recent annual report. The group has applauded the invocation of Section 232 trade tariffs, currently about 50%, to "ensure a healthy and sustainable domestic steel industry." It urged Trump to "continue to press China and other nations to eliminate steel overcapacity by ending their subsidies and other market-distorting policies that promote overcapacity."

For related information, see May 11, 2026, article - AISTech 2026: U.S. Steel Industry Healthy Riding $50 Billion Capital Spending Wave.

Bleak Outlook for U.S. Met Coal Exporters

As U.S. met coal companies increasingly relied on overseas markets, demand coalesced around a few countries, including China and India. But exports to China, the largest market for U.S. firms, nearly disappeared in 2025 as the two nations imposed hefty and varying tariffs on the other.

U.S. exports of met and steam coal to China fell 92% last year compared to 2024, to slightly under 1 million short tons from about 13.1 million short tons in 2024, according to data from EIA. Coal exports to Japan and South Korea also fell last year compared to 2024. Met and steam coal exports to India and Europe each totaled about 25 million short tons last year, slight increases from 2024.

"It's not too much to say that the fate of U.S. met coal mining companies depends on export markets, and unfortunately, those markets can purchase plenty of met coal from other, lower-cost exporters," commented Joe Govreau, Industrial Info Resources' vice president of research for the Global Metals & Minerals Industry.

"In the U.S., most steel is made by electric arc furnaces, not traditional blast furnaces," he continued. "The overseas market demand for met coal soared a few years back, but that led to an expansion of overseas met coal mining capacity. Given the transportation costs to get to Asian markets, U.S. met coal is not particularly competitive today."

"I'd say the met coal mining industry overall is in a state of managed decline," he continued. "There are some bright spots, but overall, the outlook is far less bright than it was a few years ago."

Govreau said ending the trade and tariff war with China might improve the outlook somewhat, but both countries appear to be digging into harder negotiating positions in advance of Trump's trip this week.

Govreau also noted that China produces plenty of its own coal, both met and thermal, and after that country went on a steelmaking surge a few years back, China seems to be focused more on decarbonizing its steelmaking rather than running pell-mell to increase it. China produces about 1 billion short tons of steel per year, nearly half of global production. But it increasingly is moving to making steel from electric arc furnaces rather than traditional blast furnaces.

Key Takeaways

• U.S. metallurgical coal miners face a glutted global market and falling prices.
• Coal exports to China dwindled to virtually nothing in 2025 as the U.S. and China fought an increasingly heated trade and tariff war.
• Trump is scheduled to visit China later this week, and trade is on the agenda. But it is unclear that any trade deal will meaningfully improve the fate of U.S. met coal mining companies.

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About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, Industrial Info Resources is tracking over 250,000 current and future projects worth $30.2 Trillion (USD).