Asia's Thermal Coal Imports Rise for Third Straight Month as China Mine Shortfall and Summer Heat Drive Buying
China's mine production slump is driving Asian thermal coal imports to a third consecutive monthly rise in July, while India cuts purchases to a four-year low.
Asia's seaborne thermal coal imports are on course to reach 73.16 million metric tons in July, a third consecutive monthly rise and above the 71.04 million tons recorded in July 2025, according to data from commodity analysts Kpler. India is the exception.3,4,5,6
China accounts for most of the gain. DBX Commodities data put Chinese thermal coal arrivals at 28.14 million tons in July, the highest monthly total this year and up from 25.67 million in June and 24.1 million in July 2025.3
The June production slump is the key driver of China's elevated buying. Domestic coal output fell 9.7% from a year earlier to 380.88 million tons in June after safety regulators ordered inspections following a mine accident in Shanxi province on May 22 that killed 82 people — the country's worst mining disaster in 17 years. With mines running below capacity, imports stepped in to cover the shortfall.3
Electricity demand added to the pressure. Official data showed China's thermal power generation, which is overwhelmingly coal-fired, rose 0.5% in June and 2.9% across the first half of 2026. Thermal generation is expected to grow further through the year as renewable deployment, while rapid, has not kept pace with a projected 5% rise in total electricity demand.3,4,5
Japan and South Korea also bought more fuel to meet peak summer cooling loads. Asia as a whole accounts for roughly 90% of global seaborne thermal coal trade, so the combined seasonal demand from these three buyers sets the tone for international prices. Newcastle physical coal was priced at $120.10 per tonne as of Friday (2026-07-31).3
India stands apart. Thermal coal imports fell 12% in the January-to-May period versus a year earlier, hitting a four-year low of 65 million tons over those five months, BigMint data show.1,2
The retreat reflects a deliberate shift toward domestic supply. India has been substituting domestic coal for imported fuel at power plants originally built to run on seaborne supply. Industry and government officials told Reuters on Wednesday (2026-06-24) that many such plants had raised their domestic coal share to 50%, with some reaching 70%. India has deployed domestic coal to operate 5.7 gigawatts of the 18.7 GW of capacity at import-dependent plants, with efforts underway to move another 4.3 GW.2
Rising domestic mine output and expanding solar and wind capacity have made the substitution possible. India, the world's second-largest thermal coal importer after China, has set a target to cut imported coal use for power generation by at least 30% this year.1,2
India's coal-fired generation has not declined. Capacity continues to grow and coal still supplies around 60% of total power output. The shift is in the origin of the fuel, not the total volume consumed.2
A sustained fall in Indonesian coal prices could bring Indian buyers back to the seaborne market. Indonesian supply carries freight advantages for Indian ports, but analysts said a meaningful recovery in Indian imports would require prices to drop further than they have, according to reporting from late July (2026-07-29).6
China's mine output trajectory is the variable that matters most for the seaborne market in the months ahead. If safety inspections ease and domestic production recovers from June's 9.7% shortfall, Chinese import demand could moderate from July's elevated pace. Until that happens, China, Japan and South Korea are absorbing enough seaborne coal to keep the market balanced even with India on the sidelines.3,5