China's thermal coal imports rebounded sharply in June 2026, surging nearly 40% from the prior month's low to hit their highest level since February.

Imports of thermal coal (non-coking coal) totaled 30.60 million tonnes in June, up 27.9% from 23.93 million tonnes a year earlier and up 38.3% from 22.12 million tonnes in May, according to data from the General Administration of Customs.

The strong year-on-year growth reversed a declining trend since February. An early peak in domestic power demand, amplified by forecasts of a strong El Nino, prompted power plants to advance their peak-season procurement, with active tenders for imported coal from late April through late May boosting June port arrivals and clearance.

A surge in prompt imported coal cargoes arriving in June caused congestion at southern China ports, with significant berthing delays. Some vessels offered distressed cargo at lower prices, prompting certain end-users to purchase for inventory building or calorific value adjustment.

A major coal mine accident in Shanxi in late May expanded the scope of self-inspections and production halts in key producing areas. While the incident had a greater impact on coking coal output, the broader tightening of safety inspections constrained overall coal production, partly boosting substitution demand for imports.

Price competitiveness of imported coal improved notably from June, with some grades regaining an edge over domestic supply. Australian thermal coal imports rose sharply, driven by strong demand for mid-to-high calorific value coal at competitive prices amid high power consumption.

The value of thermal coal imports in June stood at $2.48 billion, up 60.48% year on year and up 51.85% month on month, implying an average import price of $80.88/t, up 25.51% year on year and up 9.78% from a month earlier.

In the first half of 2026, China imported 159 million tonnes of thermal coal, down 6.2% year on year, with the total import value reaching $11.04 billion, down 3.49% from a year earlier. The average import price for the period was $69.62/t, up 2.84% year on year.

By coal type, June imports of lignite totaled 15.84 million tonnes, up 47.64% year on year and up 27.92% month on month, accounting for 51.76% of total thermal coal imports, down from 55.97% in May.

Imports of other bituminous coal reached 12.07 million tonnes, up 25.97% year on year and up 43.86% month on month, representing 39.44% of the total. Imports of other coal types stood at 1.65 million tonnes, down 32.74% year on year but surging 200% month on month, accounting for 5.39%. Anthracite imports totaled 1.04 million tonnes, down 10.87% year on year but up 27.93% month on month, making up 3.41% of the total.

By source, Indonesia, Australia, Russia, Mongolia and the Philippines were the top five suppliers, accounting for 98.1% of China's total thermal coal imports in June.

Indonesia remained the largest supplier at 16.46 million tonnes, up 42.21% year on year and up 34.93% month on month, accounting for 53.8% of the total, down from 55.1% in May. Australia supplied 6.36 million tonnes, surging 50.22% year on year and 91.34% month on month, with its share rising to 20.8% from 15% in May.

Russia shipped 3.63 million tonnes, down 36% year on year but up 24.27% month on month, representing 11.9% of the total. Mongolia supplied 3.37 million tonnes, up 84.69% year on year and up 15.05% month on month, accounting for 11%. The Philippines exported 390,000 tonnes, down 15.82% year on year but up 19.31% month on month.

Looking ahead, domestic coal output growth remains sluggish, with several institutions expecting thermal coal supply to continue contracting in the second half of 2026, making a significant recovery unlikely. This gap will need to be partially filled by imports, which could support thermal coal imports in the coming months and underpin coal prices. While rainfall may limit near-term demand growth, coal consumption and import demand could be pushed higher again once the rainy season ends.