European coal prices pull back as Colombian supply concerns ease

• Gas prices cap coal upside
• ARA rally loses momentum

The Atlantic thermal coal market is beginning to correct after a volatile rally driven by Colombian supply concerns. Spot DES/CIF ARA 6,000 NAR had jumped to around $138/t earlier in the week but later corrected to $132.75/t, down $2.75/t.

The correction followed the easing of immediate Colombian supply risk after Cerrejón’s force majeure ended. This removed the key trigger behind the earlier price spike.

Forward curve still signals short-term risk, not structural strength

The ARA curve remains backwardated, but the move is narrowing. July remains bid around $135/t, while Q3 2026 slipped to $129/t and Cal-27 fell to $125/t.

This structure indicates that the market is still assigning value to prompt supply, but is not convinced that European demand can sustain higher prices later in the year.

Gas remains the key cap on coal

European gas continues to limit coal upside. TTF Q3 stood near EUR 48.80/MWh and has failed to break the EUR 49-52/MWh resistance range. EU gas storage has improved to around 41% of capacity, narrowing the gap with 49% at the same time last year.

Norwegian flows have also recovered to around 305 mcm/day, while carbon prices eased to EUR 77.15/t. Together, these factors keep gas competitive against imported coal in the European power stack.

Atlantic supply is responding

Higher ARA prices have encouraged more US and Colombian coal flows towards Europe. If ARA remains above $130/t, additional Atlantic cargoes are likely to cap further upside.

The key difference from earlier rallies is that the demand side remains weak. German hard coal burn continues to face competition from gas and lignite, limiting the scope for a sustained coal-led rally.

Outlook

ARA appears to have hit near-term resistance. The Colombian risk premium has started to fade, gas remains competitive, and Atlantic supply is responding to higher prices.

Prices may remain volatile, but unless fresh Colombian disruption or a gas rally emerges, ARA 6,000 NAR is likely to trade in a lower range of $128-135/t in the near term.