China's Coal Power Climbs for a Fourth Month as Hormuz Squeezes Imports

China's Coal Power Climbs for a Fourth Month as Hormuz Squeezes Imports A crude and gas import shock has pushed China back toward coal for power, even as renewables overtake thermal capacity — a tug-of-war with steel, chemicals and Asian LNG. China's coal-fired power generation rose for a fourth consecutive month in April, the Centre for Research on Energy and Clean Air reported in its April 2026 snapshot (2026-05-21), with weak wind, subdued solar output and extended nuclear refuelling outages forcing utilities back onto coal.¹ The reason traces to the Strait of Hormuz. Shipping disruptions linked to the war in Iran cut China's crude oil imports by roughly 20% year-on-year in April and natural gas imports by about 13%, according to CREA, leaving the grid short of the fuels it would otherwise lean on.¹ Total power generation is estimated to have risen 6.6% year-on-year, but with cleaner sources constrained, coal absorbed the gap.¹ That pulls against the longer story China's own data tell. Renewable capacity surpassed coal for the first time in the first quarter of 2025, reaching 1,482 gigawatts against 1,450 GW of thermal, and coal-fired generation fell 4.7% year-on-year that quarter, ainvest.com reported (2026-05-19).⁴ Domestic coal output hit record levels in 2025, up 5% year-on-year, hollowing out the case for imports.⁴ The crunch is now showing up in industry. CREA noted the fossil fuel squeeze added pressure on the chemical sector, where feedstock and power costs feed directly into margins.¹ Solar cell production fell 25.6% year-on-year in April, reflecting weaker domestic installations and a pullback in exports.¹ Battery output, by contrast, rose 55.6%, supported by storage demand.¹ The supply side of coal capacity is moving in the opposite direction to the renewables headline. Thermal power commissioning surged more than 160% year-on-year in the first quarter to a record high, and new builds like the Ningxia Electric Investment Yongli 2×660 MW project underline that Beijing is still adding coal plants even as it installs solar at scale.¹ Solar additions fell 31% year-on-year on a high base, while wind additions rose 8%.¹ For seaborne coal, the signal is mixed. China's appetite for imported thermal coal has been in retreat, dropping from a record 47.6 million tonnes in September 2024 to a 26% year-on-year fall by June 2025, ainvest.com reported.⁴ That is bearish for exporters in Australia, the United States and Colombia who had counted on Chinese demand. Yet physical Newcastle coal sits at $132.75 a tonne, far above the COAL ETF near $26, a reminder that the Pacific physical market has stayed firm even as Chinese buying cooled.³ There is a counter-current. Analysts at ANZ said the resumption of Australian coal shipments should lift imports, which would partly refill the channel that had thinned.⁵ The same Hormuz disruption that pushed China toward coal has lifted Asian LNG: JKM spot carries a bullish supply-driven signal, and the spot price stands at $18.85 per mmBtu.¹ The wider Asian picture sharpens the stakes. Japan, with roughly 90% of its crude sourced from the Middle East, has already released around 80 million barrels from strategic reserves, equivalent to about 26 days of demand, oilprice.com reported (2026-05-20), and has leaned harder on coal through the crisis.² Two of the region's largest importers reaching for the same fuel at once tightens the seaborne market that Newcastle prices key off. The accounting underneath all this is shaky. China is burning far more coal annually than previously reported, according to new government data cited by CNBC, complicating both emissions estimates and any clean read on how fast coal demand is actually falling.⁶ "It's been a confusing situation for a long time," said Ayaka Jones, a China analyst at the US Energy Information Administration.⁶ The forward path depends on how long the import shock lasts. CREA frames the coal rebound as a direct consequence of the fuel crunch rather than a reversal of the energy transition; ainvest.com still projects coal's share of power generation shrinking to 37–40% by 2030 as renewables climb toward a quarter of primary energy.^1,4 Watch whether Australian cargoes resume in volume, as ANZ expects, and whether nuclear units return from refuelling.^5,1 If crude and gas flows through Hormuz stay impaired into the second half, the fourth straight month of rising coal burn becomes a longer trend — and the bid stays under JKM and Pacific physical coal while seaborne thermal demand from China stays soft.