China's seaborne import thermal coal market maintained a resilient tone by the end of the week. FOB offers were held firm, backed by optimistic demand expectations alongside the recent heat wave in China and India, even as some Chinese utilities showed reluctance to absorb higher costs and traders stepped back due to limited margin.

Panamax Indonesian low-CV 3,800 Kcal/kg NAR coal for late June and July delivery was generally offered above $70/t FOB, with the highest approaching $73/t. Sources reported a deal for Supramax same-CV coal concluded at a $2-plus premium over local benchmark indices.

High-CV Australian 5,500 Kcal/kg NAR coal was heard offered at approximately $105/t FOB.

Underpinning the market's confidence was a genuine surge in power demand across southern China and other Asian markets.

The Southern Power Grid reported that electricity load hit record highs for four consecutive days between May 25 and May 28, a period historically associated with peak summer months of July and August. Guangdong province saw evening peak demand rise nearly 6% year-on-year compared with July-August 2025 highs, signaling an early-season surge in power consumption. Meanwhile, Indian buyers have also maintained steady purchases amid scorching weather, supporting exporters' bullish sentiment.

The market was further supported by lingering caution following the recent deadly mine accident in Shanxi province, which triggered large-scale safety inspections. While production impacts on thermal coal were limited, the inspections reinforced perceptions of potential supply tightness.

Despite strong offers, Chinese power utilities showed measured buying interest approaching the end of this week. Domestic buyers faced steep price inversion, with imported coal priced well above domestic alternatives, creating a challenging economic environment.

Sxcoal's estimate showed that Indonesian 3,800 Kcal/kg NAR coal was 14.8 yuan/t expensive than the domestic equivalent, on a delivered to South China basis, while Australian 5,500 Kcal/kg NAR coal witnessed a bigger spread of 36.3 yuan/t as of May 28, both widening compared with the preceding week.

One Fujian importer source reported bidding 3,800 Kcal/kg NAR coal at 610-620 yuan/t CFR South China for forward cargoes, translating to around $68-69/t FOB, while overseas offers largely exceeded $71/t. Traders said that utilities were still buying when necessary, but willingness to chase higher prices remained limited.

Operational difficulties at southern ports compounded the squeeze. Multiple sources reported that discharge berths were congested, with certain terminals reportedly operating near or at capacity. One trader noted that the Xinsha terminal in Guangdong port has entered a laytime overrun situation.

"There's nowhere to unload, and a lot of cargo sold locally still hasn't moved. More arrivals are expected in early June, but utilities' purchases remain measured," said a second Guangdong-based trader source.

Russian coal shipments to China remained limited, with much of the volume being diverted to other markets. Sources said Russian coal moving into inland ports offered limited arbitrage relative to coastal delivery options. However, a high-CV 5,800 Kcal/k NAR cargo was heard traded at around 960 yuan/t for August delivery to South China, offering some cost advantage versus Australian equivalents.

Overall, the market remained divided. Import traders, unable to pass through costs without accepting losses, face an unfavorable risk-reward, and several said they were prioritizing existing inventory drawdown over new purchases.

Yet overseas miners appeared confident that the combination of early heat demand and supply-side caution would sustain prices. Forward offers remained firm, and the absence of aggressive selling from the supply side suggests that participants expect near-term tightness to persist.

Traders cautioned that while sentiment remains strong, the fundamentals may not support continued elevation of import prices through June.

Domestic portside market stable

Thermal coal offers at China's northern transfer ports remained broadly stable, with earlier rising momentum capped by limited structural shortage and increased rational voices.

"This is an emotion-driven market ignited by a one-off event," said a Shanxi-based trader source. "The safety inspections have not meaningfully reduced thermal coal output. Miners are raising prices, traders are holding, but until end users confirm acceptance, the pass-through is incomplete."

Cargoes of low-sulfur 5,000 Kcal/kg NAR coal were offered roughly flat at 775-800 yuan/t FOB northern ports with VAT, while 4,500 Kcal/kg NAR grade was offered at 670-685 yuan/t, with sellers reporting growing difficulties in finding buyers. Offers for 5,500 Kcal/kg NAR coal were heard at 870-880 yuan/t, with limited confirmed transactions.

Stocks at Bohai-rim ports continued to accumulate, hovering above the average for the same period in past several years, Sxcoal's data showed.