Weekly Thermal Coal Review: Prices Stabilize After Rapid Gains

1. Market Overview
Production Areas
China’s thermal coal supply continued to recover last week, according to CCTD monitoring data, as policy support for ensuring coal supply ahead of the summer peak season remained in place. Most mines prioritized long-term contract deliveries, leaving spot coal transportation capacity relatively tight. Overall mine inventories stayed limited, while sales conditions remained relatively stable.
Some mines raised prices slightly at the beginning of the week, but prices in major producing regions later moved sideways as the market gradually entered a consolidation phase. Although demand momentum moderated after the previous rally, overall consumption remained relatively healthy.

Ports
Market sentiment at northern ports cooled somewhat last week, though sellers generally maintained firm offers. Recent reductions in railway freight discount policies increased cargo collection costs, limiting traders’ willingness to lower prices.
Following earlier rounds of procurement, downstream buyers became less willing to chase rising prices. After a modest round of inertia-driven gains at the start of the week, port prices largely entered a stalemate as both buyers and sellers adopted a wait-and-see approach.

Imports
Imported coal prices remained well supported as Indonesian thermal coal supply continued to stay tight. At the same time, overseas buyers gradually entered the pre-summer stockpiling period, sustaining procurement demand and supporting prices.
Chinese coastal utilities continued to issue import tenders last week, with delivery periods gradually shifting toward June and July cargoes. Rising procurement costs pushed importers to further raise offer levels. In the latest utility tenders released this week, bid prices for 3,800 kcal/kg coal were mainly concentrated at around RMB 598-635/mt CFR.

2. Key Market Indicators

Port Throughput and Inventories
Average daily coal inflows and outflows at northern ports remained broadly balanced last week at around 1.99 million mt/day. After a sharp rebound following the holiday period, daily inflows declined noticeably on a weekly basis. Meanwhile, outflows remained relatively high but started to trend lower, reflecting weaker downstream acceptance of high-priced cargoes.

Bohai Rim port inventories fell by 166,000 mt week on week to 27.255 million mt as of May 15, interrupting the inventory buildup trend that had persisted since early May.
In addition, the number of vessels waiting at anchor remained elevated at around 180 ships per day, up 43% year on year. This indicates that downstream demand remains relatively strong, although procurement is still largely concentrated on long-term contract coal, while some buyers continue to stay on the sidelines due to high spot prices.

End-User Demand
Terminal demand remained resilient after the holiday period and continued to improve. According to CCTD high-frequency data, average daily coal consumption across eight major coastal provinces increased 9.9% week on week and 8.0% year on year during May 8-14.

At the same time, utility inventories edged slightly higher but still remained around 0.5% below 2025 levels, suggesting that inventory pressure at power plants remains manageable.

3. Outlook
Overall, both port and production-area prices entered a sideways consolidation phase last week after the previous rapid rally, while the pace of downstream demand releases moderated somewhat.

However, current indicators including coal burn, inventories and vessel queues suggest that additional procurement demand may still emerge approaching June. Widespread rainfall is expected across North China and the Jiangnan region this week, which could reduce wind and solar power generation. Meanwhile, high temperatures across southeastern and southern China are unlikely to ease significantly despite the rainfall, supporting cooling-related electricity demand.

Against this backdrop, China’s thermal coal market is expected to remain stable to firm in the near term. After a period of consolidation, prices could resume upward momentum as seasonal demand continues to strengthen.