US metallurgical coal did not fade, it repositioned. Mustafa Iqbal, Founder, Bloor Square Capital, considers how, as India’s blast furnace capacity expands, producers with reserves, costs, and export infrastructure are winning a selective, durable opportunity.
On 9 June 2026, S&P Global reported that Indian steelmakers have entered a multi-year investment cycle. The top four steel producers announced a 40% year-on-year increase in CAPEX for fiscal 2027, bringing committed capital to Rs 700 billion. That announcement reframes a question that has haunted US met coal for decades: not whether it will survive, but where.
The conventional narrative calls US metallurgical coal an industry in managed decline. The evidence suggests something different: an industry that lost its home market and spent four decades serving someone else’s expansion.
As domestic blast furnaces contracted, US coke production fell 80% since 1980. Rather than retreat, US producers turned outward. US blast furnaces didn’t vanish – they moved east. In 2024, India became the single largest destination for US metallurgical coal exports for the first time.
India’s blast furnace fleet is expanding at scale. The National Steel Policy targets 300 million t by 2030, 400 million by mid-2030s. JSW Steel, Tata Steel, and others are building furnaces designed to run 40 years – not flex with a single price cycle.
India imports roughly 90% of its metallurgical coal. Domestic reserves are high in ash and unsuitable for steelmaking at scale, making import dependence structural rather than temporary. S&P Global projects India’s met coal imports rising toward 100 million t by 2030. The capital behind that is committed, not speculative.
India’s supply diversification away from Australian concentration is deliberate and strategic, not incidental. Australia supplies roughly 72% of India’s coking coal imports. That concentration creates supply vulnerability that India has openly treated as a geopolitical risk. Reducing it is now part of India’s energy security framework. The diversification splits by grade. Russia supplies high-volatile and semi-soft coal at a discount, coal that extends a blend rather than anchors it. The premium hard coking coal that gives a blend its coke strength and enables world-class steel production comes from a shorter list of suppliers. That is precisely the role US coal fills: not the cheapest tonne, not a wholesale Australia replacement, but the premium grade that fewer countries can provide at scale.
The February 2026 US-India joint statement formalised the relationship, with India committing to US$500 billion of US energy products over five years and coking coal named explicitly. On the US side, critical materials designation and lower federal coal royalties have reshaped long-term reserve economics for metallurgical coal producers. Combined with India’s structural import requirement and diversification imperative, the policy window and demand window are now aligned. That convergence is rare and time-bound.
The opportunity favours producers with three things: long-life reserves, low costs, and export infrastructure built and owned. Warrior Met Coal operates as a pure-play steelmaking coal producer with cash costs near US$100 per short ton, kept investing through price weakness, and secured 53 million short tons of federal reserves in Alabama in 2025. Blue Creek began longwall production on schedule, driving production toward 12.5 – 13.5 million short tons in 2026. Alpha Metallurgical Resources produces across the full grade range and owns 65% of Dominion Terminal Associates at Newport News, a 22 million t capacity facility with blending capability serving customers in 19 countries. Both entered this downturn in net cash positions—the balance sheet strength that allows low-cost producers to secure reserves and upgrade corridors when higher-cost competitors retrench.
Global coal capital expenditure has fallen roughly two-thirds since 2010, and Wood Mackenzie projects a seaborne met coal supply gap by the mid-2030s as ageing reserves deplete and few new projects are sanctioned. The producers securing reserves now understand that structural undersupply is coming. The window to position for it is the current one.