China imported 211 million tonnes of coal from top supplier Indonesia in 2025, slumping 12.26% from the year-ago level, showed data from the General Administration of Customs (GAC).

The volume accounted for 43.1% of China's total coal imports during the year, down from 44.4% in 2024 and marking a fourth straight year of decline following a high of over 60% recorded in 2021. The share slipped to its lowest level since 2018.

Specifically, China received 209 million tonnes of thermal coal from Indonesia in the year, declining 12.4% from a year ago. Coking coal imports amounted to 2.78 million tonnes, slightly slipping 0.37% from the previous year, as per the GAC.

Indonesia's dominance surged in 2021-22 after China imposed a unformal ban on Australian supplies, dragging Australia's share close to zero and prompting Chinese buyers to turn to alternative suppliers, led by Indonesia.

However, that trend has gradually reversed over the recent years, following a gradual recovery in shipments from Australia to China in early 2023. Accordingly, the share of Indonesian coal imports dived to 46.4% that year, nearly returning to pre-ban levels.

Several factors have also contributed to the latest decline. Firstly, China's demand for imported coal weakened, as continued domestic coal output ramp-up loosened supply and weakened its reliance on imported resources.

At the same time, growing power output from clean energy sources increasingly squeezed the demand for coal-fired power generation and consequently limited the growth potential for imports.

In 2025, China's coal imports from all sources totaled 490 million tonnes, plunging by 9.63% from the preceding year, the GAC data showed.

Secondly, the narrowed price edge of Indonesian coal over Chinese domestic equivalent deferred purchases by some price-sensitive end users.

In 2025, the spread between Indonesian low-CV coal and China's domestic 4,500 Kcal/kg NAR grade, on a CV-converted and delivered to South China basis, dropped to its lowest level in at least six years.

During the year, the Indonesian government introduced a series of policies aimed at revitalizing the country's coal industry, including tighter foreign exchange controls implemented in March, the B40 program, and an export pricing policy linked to the reference prices of HBA.

These measures posed mounting financial pressures on local miners, prompting them to raise export prices to pass on their cost pressure to buyers. By mid-2025, prices for Indonesian coal even exceeded China's domestic coal, dragging Indonesian coal inflows to a multi-year low.

Finally, coal from other sources has continued to encroach on Indonesia's market share. Backed by high cost-effectiveness and sustained demand from China's non-power sectors, the share of Australian coal imports rose from 15.34% in 2024 to 15.79% in 2025, smashing a new high since the ban.

Meanwhile, the share of Russian coal in China's total imports also rose from 17.52% in 2024 to 18.12% in 2025. Improved logistics infrastructure and expanded production in eastern Russia helped offset the impacts of mine closures in Kuzbass and rising transportation costs, enabling Russian coal to maintain competitiveness in the Asian market.

China's imports of Mongolian coal also surged in 2025, making it one of the few major import sources to see year-on-year growth. The share of Mongolian coal reached a record high of 18.1%, thanks to the country's measures to build cross-border railways and enhance border clearance capacity.

Looking forward at 2026, Indonesia's coal exports may still lack supports. The government announced coal export tariffs starting from January 1, while the Ministry of Energy and Mineral Resources signaled a possible sharp reduction of annual coal product to approximately 600 million tonnes.

Compounded by slow approval process for annual RKAB mining quotas among Indonesian miners, expected declines in output and policy uncertainties, the country's coal export market is likely to remain under pressure.

As a conclusion, the share of China's imports of Indonesian coal is expected to shrink further, mainly due to relaxed domestic supply-demand dynamics and expectations of further declines in Indonesian supplies, as well as the narrowing price advantages and substitution from other sources.