ARA coal stockpiles dip to 3.32 mm tonnes ahead of winter

Should we be concerned?

Coal stockpiles at ARA dipped again last week to 3.3 mm metric tonnes, down from 6 mm metric tonnes at this time last year and the lowest levels since 2022. The stockpiles are mostly thermal coal for use in NW Europe, so what does that mean for Atlantic Basin thermal coal prices? 6 mm metric tonnes last year was uncomfortably high. But should we be concerned about holding only 3.3 mm metric tonnes ahead of this winter?

From my reading of the trade press, the consensus view seems to be that the low stockpiles aren’t a big deal because coal is now a smaller part of the European generation mix. The logic: low coal burn means Europe doesn’t need a lot of coal in stockpiles. So, the historically low stockpiles aren’t showing “tightness” in the supply/demand equation, they’re just showing a “rightsizing” of stockpiles.