Coal Prices Plunge to Two-Month Low Amid Mixed Asian Market Signals
The price of coal has recorded a decline amid mixed sentiments affecting the Asian market. Based on the latest trading data on Friday (26/6/2026), the Newcastle coal futures contract closed at US$126 per tonne. This position represents a 1.95% weakening compared to the previous day’s close of US$128.5 per tonne. With this result, the coal price has fallen by 2.36% over two consecutive trading days. This closing price is also the lowest point since 21 April 2026.
The price drop occurred amidst the dynamics of energy demand and supply in Asia. Seaborne thermal coal imports in Asia are on the rise, driven by China increasing its import volumes to compensate for a decline in domestic production, as well as Japan and South Korea striving to maintain their energy security.
According to projections from commodity analysis firm Kpler, the volume of seaborne thermal coal imports in Asia is estimated to reach 77.74 million metric tonnes in June 2026, the highest figure in six months. This volume is an increase from 68.39 million tonnes in May 2026. Compared to the same period the previous year (63.24 million tonnes), the estimated imports for June show an increase of approximately 22.3%.
The rise in imports is significantly influenced by the energy policies of Japan and South Korea, two nations with the flexibility to switch power generation sources between coal and liquefied natural gas (LNG).
Spot market LNG prices previously experienced an increase due to geopolitical tensions in the Middle East at the end of February 2026, which affected global energy logistics distribution channels. Although LNG prices have since adjusted, they remain at a relatively higher level compared to the pre-conflict period. These high LNG prices make thermal coal a more economical alternative energy source. Even though coal prices have also risen, the energy cost differential has encouraged several electric utility companies in Japan and Korea to prioritise coal usage.
Japan, the world’s third-largest coal importer, is estimated to import 7.82 million tonnes of thermal coal in June 2026, marking the third consecutive monthly increase. Meanwhile, South Korea’s imports are projected to reach 7.30 million tonnes, the highest level since the beginning of the year.
China, the world’s largest coal importer, has also increased its purchases. Seaborne thermal coal imports are estimated to reach 27.65 million tonnes in June 2026, the highest in six months. Unlike Japan and South Korea, China’s import increase is primarily driven by domestic market conditions. Electricity demand from thermal power plants has risen, while domestic coal production is showing a downward trend. Stricter safety inspections at mining sites following workplace accidents have led to reduced output and higher domestic coal prices. At these elevated domestic price levels, imported coal of medium and low quality becomes a more competitive choice for Chinese power generation companies, thus driving the increase in imports.
In contrast to East Asian nations, India is showing a relatively stable to declining import trend. India’s seaborne thermal coal imports are estimated at 12.32 million tonnes in June 2026. Current global coal price levels have prompted several Indian power generation companies to refrain from excessive purchasing. As an alternative, India is optimising the use of existing coal stockpiles and progressively increasing the proportion of renewable energy. Notably, electricity production from renewable sources in India has experienced significant growth, contributing a record share to the nation’s total power generation.