East Asian import demand drives seaborne coal price rebound after China curbs

The nations in East Asia will see significant increases in coal demand as the winter months approach. The coal sector has seen a sharp decline in output in recent months; however, several factors have caused a rebound in the coal price in the region. Coal is still essential to many nations’ energy needs, and despite the apparent transition to renewable energy generation being championed by the EU, coal will remain crucial for the East Asian region as the colder months approach.

Coal imports into Asia reversed a nine-month-long losing streak

Many nations in the Asian continent rely on the coal sector to meet their energy needs. The region has been ravaged by several environmental disasters over the past decade and requires innovative solutions to the energy crisis unfolding in the region.

Coal is the obvious choice for power generation; however, the world has become acutely aware of the effect that relying on coal has had on the environment. Despite the apparent disdain for our own reliance on the traditional energy generation that coal uses, the sector has seen a significant rebound after nine long months of poor performance.

Data from commodity analytics provider Kpler has revealed that thermal coal imports in Asia jumped to 85.34 million tons last month, up by 6.4 million tons from July and the first monthly amount exceeding 81 million tons since December 2024.

That increase is a direct result of the Chinese government curbing oversupply issues in their coal mining region in Inner Mongolia, among others.

The coal sector might see even better numbers as the cold winter months grow closer

In any country, winter presents the electrical grid with significant pressure as the population tries to stay warm. The East Asia region contributed significantly to the increase in coal imports across the world. Among the biggest buyers of coal were China, South Korea, and Japan.

Interestingly, China has been conducting a series of inspections across several coal sites as oversupply issues surface. That added to the import numbers in the region and strengthened the standing of coal in the region overall.

Key seaborne thermal coal grade prices rebounded in September from four-year lows in June and July. With July arrivals down by 23% from a year earlier, the coal sector can take solace in the news coming out of Asia, which saw China’s coal imports strengthen in August.

China’s reliance on coal is set to increase in the coming months, too, as the nation enters winter. China is on track to import 27.41 million metric tons of seaborne thermal coal this month. Certain nations in the region have implemented new measures that alleviate the pressure on the energy sector by easing regulatory barriers.

So one could expect the numbers to increase even more in the months to come. The International Energy Agency has reported that it expects electricity demand in Southeast Asia to boom in the coming years, doubling from current levels by 2050.

The coal sector will continue to play a role in our lives, like it or not

Reports from the International Energy Agency have stated that coal usage in several countries will continue to rise for the rest of the year. How that might affect the climate remains to be determined. Regardless, the coal sector is alive and kicking in the Eastern part of the world. Environmental watchdogs have urged the countries of the world to come together to develop new renewable energy capacity that could transition us away from our reliance on coal. With several governments committing to decarbonization, the news of increased coal usage undermines the efforts of those trying to steer us away from the coal sector.