London — US coking coal miner Warrior Met Coal, which continues to negotiate with workers planning strike action effective April 1, has reportedly seen its coal inventory fall sharply from 1 million st at the start of the year due to strong export demand, according to market sources.
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Warrior's contract with the United Mine Workers of America (UMWA) is set to expire on April 1, and the company has been working to reach an agreement, the Brookwood, Alabama-based miner said in a March 31 statement. Warrior produced 7.9 million st of coking coal in 2020, 7.2% lower on 2019, due to weaker demand stemming from the onset of the COVID-19 pandemic in the second quarter of last year.
Warrior said it has continuity plans in place to continue meeting the demands of "key customers," which include steel producers in South America and Europe, and growing volumes shipped to China via Warrior's partnership with international trader Xcoal Energy & Resources.
Warrior has seen strong contract-based volumes sales in Q1, with its main premium HCC product Bluecreek No. 7 pricing under contracts using S&P Global Platts Premium Low Vol HCC FOB Australia benchmark. Australian spot prices since Q4 have fallen below US spot indices, due to a mismatch with low spot demand in China after import restrictions were introduced.
Higher demand for US and Canadian coking coal in China led to stronger spot prices for Warrior's coals, with Platts assessing Bluecreek No. 7 at $160/mt FOB Mobile on April 1, higher than prices in March, and compared with PLV at $112.50/mt FOB Australia.
Spot availability for Warrior's Bluecreek No. 7 and No. 4 coals were heard to be currently limited on strong bookings and contract inquiry from earlier this year.
Warrior said it employs 1,400 workers through operations including two underground mines and export facilities at the port of Mobile, which include some of the highest paying jobs in Alabama.
Metallurgical coal accounts for 50% of the revenue generated by the Alabama State Port Authority, Warrior said.
Other exporters currently using Mobile include Javelin Global Commodities, which loads coals such as premium low-vol Oak Grove from the US Gulf port. Javelin did not respond to a report of a longwall change at Hatfield Metallurgical Holding's Oak Grove mine, which is due in April and affect production.
Peabody Energy's Shoal Creek mine is currently idled, which previously shipped out of Mobile to customers mainly in Europe and Japan.