The US Department of Energy (DOE) has added coking coal to its Critical Materials List, the agency said in a notice yesterday, brushing aside reservations in a bearish market.
The move comes a month after President Donald Trump ordered an investigation into the country's coal policy. US coking coal producers could benefit from quicker mine permitting, tax credits and federal grants as a result. The goal, the government says, is to increase the country's coking coal output.
"Meeting the policy goal of US steel dominance will require dramatic increases in domestic metallurgical coal production and use," the DOE said in its assessment yesterday.
With prices at a four-year low, the decision could have unwanted consequences for the US coal market. The seaborne coking coal market tilting into oversupply has weighed heavily on index prices. Several US coking coal producers are operating near or above production cost, and many have cut output since the fourth quarter of 2024.
US mining firms have spoken of the need for consolidation in the industry, which could be held off if struggling firms get financial support from the state. But suppliers have also complained of a global coal glut driven by Russian and Mongolian producers. Any additional tonnes could further weaken prices.
The DOE estimates that the US needs to produce 18mn st (16mn t) more coking coal to become a net exporter of steel. With coking coal producers in the country already struggling, the department argued, the government must intervene to stop a future crisis in the steel supply chain.
The DOE assumption is based on all new steel production being carried out with blast furnaces in its assessment. But the agency also noted that more than 70pc of US steel is produced utilising the electric arc furnace method. US steelmakers would only need to consume 4-5mn st more coking coal to achieve the government's goals, factoring in the use of electric arc furnaces.
The US exported 56mn st of coking coal in 2024, according to data from Global Trade Tracker.
