China's coal market experienced accelerated production and increased imports in November 2025, while power sector's demand for thermal coal declined amid surged coal prices in the month.

Coal output quickens

China produced 426.79 million tonnes of raw coal in November, down 0.5% year on year but up 4.93% month on month, according to the National Bureau of Statistics (NBS). The yearly decline contracted by 1.8 percentage points from October, suggesting a decrease for the fifth consecutive month.

Driven by policy directives for winter energy security and a record-high market coal price rally in November, domestic coal production saw a significant uptick in November. The increased output followed the recession of adverse weather impacts, as well as the normalization of overcapacity checks, safety and environmental inspections.

For the first eleven months, cumulative raw coal output reached 4.40 billion tonnes, up 1.4% year over year, contracting by 0.1 pp from the January-October period.

Coal import rebounds

The country imported 44.05 million tonnes of coal in November, down 19.9% on the year, expanding 10.15 pps from October, as per data from the General Administration of Customs (GAC). The import volume was 5.6% higher than a month ago, which marks a reversal from October's monthly decline of 9.27%.

The sharp rise in domestic coal prices made imported coal more attractive, leading to an increase in coal imports during the traditional restocking month.

The significant increase in domestic coal prices was primarily due to limited supply growth, low portside inventories, and stockpiling by middlemen. The market was in a transitional period between peak and off-peak seasons, with most end buyers focused on fulfilling long-term contracts.

Meanwhile, coal production and transportation in Indonesia was affected by the rainy season, and some companies sold out their stocks around the year-end. The supply of Australian and Russian coal was constrained by weather and logistics issues, limiting coal availability to China.

Furthermore, the coal imported in November was mainly procured in late September. Power plants had adequate coal inventories, and the peak demand had yet to arrive, which led to a reluctance for early stocking.

Coal imports in November showed a continued decline on a year-on-year basis, with the drop widening by 10.15 pps compared to October. The primary reason for this decline is the high base from the previous year. In November 2024, coal imports reached a historical high of 54.98 million tonnes.

From January to November, China imported 431.68 million tonnes of coal, down 12% compared to the same period last year.

Thermal power rebounds

Thermal power output nationwide reached 497 TWh in November, down 4.2% year on year and 3.27% month on month, NBS data showed.

In November, mild weather across most of southern China led to stable residential power demand and a notable narrowing of the peak-valley difference in the electricity grid. Coupled with improved output from renewable energy, thermal power generation shrank.

China's power generation from all sources stood at 779.2 TWh in November, up 2.7% from a year ago, with a daily average of 25.97 TWh. Over the first eleven months, cumulative power generation rose 2.4% year on year to 8,856.7 TWh.

Hydropower output reached 96.7 TWh last month, up 17.1% year on year, shrinking 11.1 pps compared to October. Wind power recorded a 22% growth, while solar power rose 23.4%, accelerating by 17.5 pps.

Non-power coal demand slides

November saw a third consecutive monthly drop in coke production, down 0.5% from October to 41.7 million tonnes, though still 2.3% higher year on year, as per NBS data.

Pig iron output fell 8.7% from a year earlier to 62.34 million tonnes, the lowest since March 2024. That was 4.9% lower month on month, representing a six-month losing streak. Crude steel production also hit its lowest since March 2024, at 69.87 million tonnes, down 10.9% year on year and 3% on the month.

Finished steel output dropped 2.6% from the year before and 2.3% from the month before to 115.91 million tonnes. Cement production slid 8.2% year on year but rose 4.46% month on month to 154.34 million tonnes.

In November, multiple factors continued to weigh on the non-power sectors. While output from some industries saw a slight month-on-month increase, the growth was limited. As production continued to decline, coal consumption also followed suit.

Conclusion

In November, despite a month-on-month increase in domestic coal production and improved imports, coal consumption continued to decline due to reduced thermal power generation and weak non-power sector demand. However, the market saw a significant price surge.

November's atypical market performance was likely driven by market sentiment, with middlemen stockpiling and creating an illusion of increased demand, which pushed prices up.

As December arrives, it is expected that demand should rise due to cold weather. However, so far, weather support was limited, and coal prices failed to show seasonal strength.