India's coal imports in December 2025 extended decline month-on-month, but saw a significant year-on-year (YoY) growth of more than 5%. While thermal coal imports remained below the month- and year-ago levels, coking coal imports hit the highest level in five months.

The country imported 18.45 million tonnes of coal in December, up 5.51% YoY but down 4.02% MoM, according to data from iEnergy.

In December, India's coal market exhibited structural divergence amid volatile international landscapes. Global thermal coal prices remained under sustained pressure, primarily driven by seasonal demand lull, high stockpiles and subdued import appetite in the Asia-Pacific region.

Major consumer China showed subdued import interest due to sluggish domestic demand, further depressing coal prices in the seaborne market. The import demand in India remained low as well, constrained by ample domestic supply, adequate stocks at power plants and moderate power demand growth, leading to a contraction in seaborne coal procurement.

At the same time, the coking coal market remained resilient, with prices fluctuating at elevated levels, backed by tight supply of high-quality Australian coal and year-end restocking by Indian steel mills. The petroleum coke market, however, weakened on declining freight costs, tepid end-user demand, and growing competitiveness of low-priced thermal coal.

As market sentiment was bolstered by tight spot supply, cautious mine sales and stable restocking demand, Indian steelmakers engaged in selective stockpiling, particularly for high-quality low- and medium-volatile coal, offering upward momentum for coal prices.

In 2025, the country's coal imports totaled 246 million tonnes, down 0.73% YoY from 248 million tonnes in 2024, iEnergy data showed.

In breakdown by type, the South Asian nation imported 11.09 million tonnes of non-coking coal in December, down 4.6% YoY and 8% MoM, while anthracite imports decreased by 46.35% YoY and 24.66% MoM to 99,000 tonnes. The reductions were mainly driven by abundant inventories held by power plants, marginal growth in power demand and growing electricity output from renewable energy sources.

Imports of coking coal reached 5.69 million tonnes during the month, up 56.97% YoY and 11.31% MoM to the highest reading in five months. This was mainly driven by increased domestic steel production and the implementation of import restrictions on metallurgical coke, which led to increased demand for coking coal. Imports of PCI coal totaled 1.57 million tonnes, down 23.41% YoY and 18.33% MoM.

India imported 220,900 tonnes of met coke in December, diving 59.98% YoY and 7.61% MoM, while petroleum coke imports slumped 23.82% YoY yet jumped 25.86% MoM to 970,400 tonnes.

India's steel and sponge iron industries imported most coal in December, reaching 7.9 million tonnes, up 0.58% YoY and keeping flat MoM, as per iEnergy data.

The country's steel sector has outperformed its global peers, thanks to robust domestic demand, ongoing capacity expansion and policy supports. Despite oversupply and weakness in prices in the international market, the country's crude steel output grew 10% YoY in the first eleven months of 2025, reflecting its structural advantage.

Major Indian steel manufacturers are poised to benefit from the improving industry environment, with expansion plans, enhanced raw material supplies, and increased share of high-value-added products underpinning their profit growth.

In December, India's power sector imported 3.10 million tonnes of coal, up 15.96% YoY yet down 5.83% MoM; the cement sector imported 1.03 million tonnes, surging 107.4% YoY and 11.83% MoM; and the chemical industry received 627,400 tonnes, jumping 18.67% YoY and 142.2% MoM.

Power generation in India has undergone a structural shift in 2025, with a robust growth renewable and hydro power offsetting declines in thermal generation. The nation's power output totaled 1.83 TWh in the year, up 1.7% YoY. Among these, thermal power generation declined by 4% YoY to 1.31 TWh. Nevertheless, thermal power remained dominant in the country's electricity mix, accounting for 72% of the total generation in the first half of 2025.

Additionally, India's cement industry is showing signs of rebound, supported by improved demand and gradual price gains. As the construction sector enters its seasonal peak, the sector's coal demand is expected to remain robust in the coming months.

By origin, Indonesia remained India's largest coal supplier in December, shipping 6.86 million tonnes, climbing 10.05% YoY yet declining 3.44% MoM. Australian coal arrivals gained 22.04% YoY and 14.48% MoM to 3.90 million tonnes.

Imports from South Africa dropped 30.44% YoY and 14.35% MoM to 2.49 million tonnes, and Russian coal imports retreated 6.4% YoY and 19.95% MoM to 2.21 million tonnes. Coal intakes from the U.S. ascended 67.48% YoY yet edged down 2.31% MoM to 2.02 million tonnes.

Looking ahead, as domestic output and renewable energy grid connection continue to expand, India's demand for imported thermal coal may further contract. Its dependence on imported coking coal, however, may persist, with prices remaining resilient amid tight global supply. Meanwhile, import restrictions and tariff adjustments on petroleum coke and coke are expected to continue affecting trade flows for these commodities.