China's July Coal Import Forecast Hits Year High as Shanxi Accident Crimps Domestic Supply
A production slump triggered by mine safety inspections and steady demand growth are pushing China's seaborne coal purchases to their highest monthly level of 2026.
China's thermal coal arrivals are forecast to reach 28.14 million tonnes in July (2026-07), the highest monthly total this year, according to commodity analysts DBX Commodities, up from 25.67 million tonnes in June (2026-06) and 24.1 million tonnes in July 2025. The shortfall driving that increase is supply-side.7
Domestic coal production fell 9.7% year-on-year in June (2026-06) to 380.88 million tonnes after China's government intensified safety inspections following a mine accident in Shanxi province on May 22 (2026-05-22) that killed 82 people, the country's worst mining disaster in 17 years, according to official data. Utilities had no domestic buffer to absorb it.7,6
China's thermal power generation, which is overwhelmingly coal-fired with a small share of gas capacity, rose 0.5% in June (2026-06) and 2.9% over the first half of 2026, official data showed. Total power demand is expected to grow roughly 5% this year. Renewable additions have not been expanding fast enough to cover all of the incremental load.7,6
The seaborne market is absorbing the volume. Asia, which accounts for about 90% of global seaborne thermal coal demand, is forecast to import 73.16 million tonnes in July (2026-07), up from 70.31 million tonnes in June (2026-06) and above the 71.04 million tonnes shipped in July 2025, according to Kpler data.7,6
China is not buying alone. Japan and South Korea have stepped up purchases partly for energy security after the US-Israeli military campaign against Iran effectively closed the Strait of Hormuz on February 28 (2026-02-28), stranding around 20% of global LNG supply produced by Qatar. JKM spot Asian LNG was priced at $21.32/MMBtu on July 29 (2026-07-29), still well above the $10.40/MMBtu in the week to February 27 (2026-02-27) before the conflict began. Thermal coal has become the cheaper fuel-switch for utilities across the region.7,4,5
Newcastle coal physical traded at $119.65 per tonne as of July 29 (2026-07-29). That sits well below the mid-June (2026-06) peak of $150.25 per tonne recorded at Newcastle Port as LNG prices surged, but still above the $115.96 per tonne prevailing before the Iran war began, per globalCOAL data.4
Asia's June (2026-06) thermal coal imports had already signalled the direction. Total regional imports tracked 77.37 million metric tonnes that month, the highest in six months and 22.3% above the 63.24 million tonnes imported in June 2025, according to Kpler.4
But the monthly thermal power growth figures from China tell a more nuanced story. Year-on-year increases ran at 3.1% in April (2026-04) and 2.1% in May (2026-05) before slowing to 0.5% in June (2026-06), according to official data, even as the aggregate first-half gain of 2.9% outpaced the 1.5% full-year increase recorded for 2024. A deceleration in mid-summer power demand growth, if sustained, could ease import pressure more quickly than the July (2026-07) figures suggest.3,4,6,2
India is the one exception to the regional rebound. Asia's thermal coal imports are rising broadly except for Indian purchases, where domestic supply and local pricing have diverged from the rest of the region, according to Kpler data from Tuesday (2026-07-29). Analysts say a sustained decline in Indonesian coal prices could eventually draw India back, but expect no significant recovery in Indian purchases unless prices fall further still.7
The pace at which Chinese mine output recovers from June's 9.7% year-on-year slump remains the central variable for Newcastle coal pricing through the rest of the third quarter of 2026. Production had already pulled back from an all-time high set in March (2026-03), and the safety-inspection regime shows no sign of easing. If output stays depressed and China's power demand growth holds near the first-half pace, the seaborne market will remain tightly supplied into the peak cooling season. A faster-than-expected restart of Shanxi province capacity, or any diplomatic resolution that reopens Hormuz shipping lanes and drives JKM back toward pre-war levels, would change the import calculus quickly.7,6,1