- Low gas inventories and LNG uncertainty support coal prices.
- Colombian cargoes dominate visible coal shipments towards Europe.
European and Atlantic thermal coal markets entered October on a firmer footing as expensive gas, winter supply concerns and geopolitical uncertainty supported prices. However, the latest assessments show that coal’s upward movement is not simply following oil or freight: European coal prices rose even as Brent and some Atlantic shipping rates eased.
The benchmark for 6,000 kcal/kg NAR coal delivered into Amsterdam-Rotterdam-Antwerp (ARA) reached $145.05/t on 6 October, up $3.50/t, or 2.5%, from 1 October. South African and US export assessments also strengthened, indicating support across several Atlantic supply origins.
Gas and LNG strengthen coal’s competitive position
Europe’s limited gas inventory cushion remains a central influence on coal sentiment. EU storage was approximately 73% full in early October, against around 83% a year earlier and a five-year average near 88%. This leaves the market more sensitive to colder weather and interruptions in LNG deliveries.
The Middle East conflict has disrupted a corridor that carried almost one-fifth of global LNG trade before the war. The International Energy Agency estimates that Qatar and UAE LNG loadings declined by about 35 billion cubic metres year-on-year during March-June. Increased exports from other regions offset much, but not all, of the shortfall. Competition with Asian buyers adds another challenge to European replacement procurement.
Expensive gas improves coal’s relative economics where generating capacity remains available. Recent analysis indicates that European coal and lignite generation margins have overtaken gas-fired equivalents. However, previous coal plant closures constrain the scope for additional fuel switching: stronger margins cannot restore capacity that has already exited the system.
Electricity demand depends on weather and renewable availability
Higher gas prices do not translate uniformly into higher electricity prices or coal consumption. Strong wind and solar output can reduce thermal generation requirements, while low-wind periods and declining daylight increase dependence on dispatchable plants.
Eurelectric’s earlier analysis illustrates this distinction. Average EU electricity prices outside solar hours reached €122/MWh during May-June 2026, compared with €90/MWh a year earlier, while daytime prices averaged approximately €56/MWh. Renewable availability can therefore cushion the fuel-price shock during some hours while leaving the system exposed during others.
For winter coal procurement, the key upside risk is cold weather coinciding with prolonged weak wind generation. Mild temperatures and stronger wind would ease immediate coal burn. Current firmness consequently reflects expectations and supply protection as well as realised consumption.
Carbon remains a substantial cost for coal-fired generation. EU allowance prices eased slightly between 1 and 6 October, offering modest relief, although coal’s emissions burden continues to influence dispatch decisions.
Colombian cargoes anchor visible European supply
BigMint’s vessel tracking for 26 September-2 October identifies seven non-coking coal shipments carrying approximately 0.70 mnt towards European destinations. Colombia supplied 0.61 mnt, or 86.4%, with the US accounting for the remaining 0.10 mnt. These represent recorded departures with nominated destinations, rather than confirmed European arrivals.
The Netherlands attracted approximately 0.50 mnt across three Colombian cargoes: 173,187 t towards IJmuiden, 158,800 t towards Rotterdam and 164,453 t towards Amsterdam. Together, these accounted for 70.6% of identified Europe-bound shipments. Colombia also shipped 54,229 t towards Gdansk in Poland and 56,852 t towards Santander in Spain. US cargoes comprised 60,300 t towards Skagen in Denmark and 35,500 t towards Genoa in Italy.
Europe represented 46.3% of Colombia’s tracked thermal coal exports of 1.31 mnt during the period, compared with 14.1% of US shipments of 0.68 mnt. The pattern highlights Colombia’s importance to European replenishment and the Netherlands’ role as a regional gateway, rather than solely a domestic consumption destination.
South African shipments, meanwhile, included approximately 0.45 mnt towards India, 0.20 mnt towards Pakistan and 0.06 mnt towards Bangladesh, demonstrating competing demand for Atlantic supplies. No identified European destination appeared in this snapshot, although destinations remained unspecified for 0.31 mnt of South African cargoes.
Geopolitics and diesel costs reshape procurement
The Russia-Ukraine war has structurally altered European sourcing. EU restrictions on Russian coal, effective since August 2022, increased reliance on alternative origins. Russian export prices therefore cannot be treated as directly interchangeable procurement options for EU buyers.
The Middle East conflict affects Atlantic coal through LNG availability, petroleum-product costs and shipping uncertainty, including where coal vessels avoid the disrupted routes.
Diesel tightness creates a separate cost pressure. On 7 October, the IEA called for accelerated implementation of previously agreed emergency oil releases, prioritising diesel. Higher diesel costs can raise expenditure on mining equipment, inland haulage and diesel-powered rail transport, even when crude prices temporarily soften.
Ocean freight nevertheless moved differently during the assessment window. Bolivar-Rotterdam Capesize rates declined nearly 10%, while US Atlantic routes eased modestly. These movements provided some delivered-cost relief and caution against attributing coal’s price increase to universally rising freight.
BigMint assessment
European and Atlantic thermal coal retains near-term support from expensive gas, low storage buffers and winter supply uncertainty. Visible Colombian shipments confirm an active replenishment pipeline, while Asian demand provides alternative outlets for Atlantic suppliers.
Further price strength would depend on sustained LNG disruption and cold, low-wind conditions translating into higher coal burn. Reliable gas deliveries, stronger renewable output and softer freight could restrain that increase. The market’s fuel-security premium remains supported, but its durability will depend on actual winter consumption and supply availability.
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