Asia's seaborne thermal coal import demand strengthened in October 2026, driven by pre-winter restocking and gas-to-coal switching, with Indian power buyers returning to the market on low inventories, partly offset by weaker Chinese demand.

Asia's seaborne thermal coal imports totaled 73.49 million tonnes in October 2026, down 2.99% year on year but up 5.63% from the previous month, according to Kpler ship-tracking data. Cumulative imports over January-October reached 709 million tonnes, down 2.55% from the same period a year earlier.

China's seaborne thermal coal imports edged up month on month in October but remained on a clear downward trend year on year. Imports stood at 25.25 million tonnes, down 14.59% year on year but up 5.63% month on month. Cumulative imports over January-October were 230 million tonnes, down 9.11% year on year.

Chinese thermal coal demand stayed sluggish in October, with seaborne imports posting sharp year-on-year declines since August. The price advantage of imported coal narrowed during the month, leaving Chinese buyers reluctant to chase higher prices. Although domestic consumption gradually picked up, output failed to keep pace, deferring some potential demand to the first half of 2027.

Entering winter, inventories at northern ports and southern power plants sit at seasonal levels. Winter would normally lift imports, but elevated global coal prices have made domestic coal more competitive, capping room for import growth this year. Kpler expects China's thermal coal imports to stay out of year-on-year growth territory for the remainder of 2026.

Cumulatively, China's seaborne thermal coal imports over January-October were 230 million tonnes, down 9.11% from 254 million tonnes a year earlier.

India's seaborne thermal coal imports came in at 14.44 million tonnes in October, up 15.14% year on year and 31.78% month on month, the highest since July 2025. Cumulative imports over January-October were 123 million tonnes, down 8.9% year on year.

India's thermal coal imports rebounded sharply in October on coal-fired generation demand. Weak hydropower supply and unusually high temperatures raised coal-burn load, pushing power plant inventories to multi-month lows.

More than 50% of India's operating power plants held critical coal stocks during the month, while domestic output failed to meet the power sector's growing coal demand, forcing utilities back to the seaborne market.

As of October 28, coal inventories at Indian power plants fell 3% month on month to 20.39 million tonnes, with stocks at 89 plants at critical levels. With winter approaching and pre-holiday restocking needs, India's import demand is expected to stay high over the next two months.

Japan's seaborne thermal coal imports were 7 million tonnes in October, down 22.32% year on year and 22.96% month on month. South Korea's imports were 6.13 million tonnes, down 6.49% year on year and 15.05% month on month.

Gas-to-coal switching supported coal demand in Northeast Asia. However, higher nuclear power supply alongside lower electricity demand left insufficient residual demand to lift coal consumption, so coal-fired generation in Japan and South Korea did not grow and merely avoided the impact of falling gas demand.

In South Asia and Southeast Asia, thermal coal imports held broadly steady with an upward bias in October. The Philippines imported 3.56 million tonnes, up 8.65% year on year and 10.44% month on month. Malaysia imported 2.86 million tonnes, up 4.52% year on year but down 4.35% month on month. Vietnam imported 3.25 million tonnes, up 34.54% year on year and 12.61% month on month.

Philippine buyers built precautionary stocks amid uncertainty over Indonesian coal regulatory policy. Indonesian authorities assured the government that existing contracts would be honored, but heavy reliance on a single supplier leaves the country's import supply exposed. Meanwhile, growing coal consumption potential and weak hydropower output restored Vietnam's import growth momentum in October.

On prices, limited Atlantic Basin demand kept coal prices closely tied to gas prices. U.S. natural gas futures fell sharply after the midterm elections as the market priced a lower likelihood of an escalation in the U.S.-Iran conflict.

Kpler expects Atlantic Basin demand fundamentals to remain weak, with low Rhine water levels in early October curbing coal demand potential. After this winter, expectations that the EU will rebuild gas inventories could offer some support to gas-to-coal switching and coal prices, though there is little clear upside room on the demand side.

Overall, faster restocking lifted Asia's thermal coal imports in October. Looking ahead, falling LNG prices should pull coal prices toward winter forecasts, with Asia-Pacific fundamentals relatively solid and resilient to downside; China's import recovery may be delayed to the first half of 2027, while restocking in India and Japan and gas-to-coal switching in South and Southeast Asia will continue to support demand.