Coal Prices Suddenly Soar, Indonesia in Global Spotlight

Coal prices suddenly ignited. According to Refinitiv, coal prices closed at US$132 per ton on Thursday (16/7/2026), jumping 1.15%. This increase broke a two-day negative trend, and yesterday’s closing price was the highest since 17 June 2026, or in the last month. Coal prices soared again, supported by high oil prices and strong demand. Bloomberg reported that Asian thermal coal prices surged to their highest level in 22 months after Indonesia’s new export rules sparked concerns over global supply. As the world’s largest thermal coal exporter, changes to Indonesia’s export mechanism are reportedly causing shipment delays and tightening supply. This situation is pushing major importing countries such as China, India, Japan, and South Korea to seek alternative supply sources. The price surge was also reinforced by high electricity demand during the summer in Asia, while supply from other countries has not been able to replace Indonesia’s role. Market participants estimate coal prices will remain high if export disruptions from Indonesia continue, given Indonesia’s crucial role in the global thermal coal trade. South Korea’s coal imports soared in June 2026, reaching 10.13 million tonnes. This volume is the highest in five months and the highest level for the month of June in four years. Data from the Korea Customs Service showed the import volume rose 31.97% compared to June last year and increased 22% compared to May. The surge was driven by stockpiling ahead of the summer to anticipate a spike in electricity demand. Throughout the first half of 2026, South Korea’s coal imports reached 57.04 million tonnes, up 21.55% year-on-year. Coal remains the most economical energy choice after LNG prices surged due to the US-Iran conflict. Additionally, limited electricity supply from nuclear power plants further increased coal usage. In terms of suppliers, Australia remained the largest exporter to South Korea with shipments of 4.13 million tonnes, followed by Russia with 2.21 million tonnes. Meanwhile, imports from Indonesia reached 1.72 million tonnes, down 11.36% compared to last year, although up 22.49% compared to May. The value of South Korea’s coal imports in June also surged to US$1.39 billion, up 62.39% year-on-year. The average import price reached US$136.76 per tonne, reflecting persistently high coal prices in the global market. In contrast to South Korea, India’s thermal coal imports fell 12.5% to 77.61 million tonnes in the first half of 2026. According to BigMint data, the decline occurred alongside increased use of renewable energy, abundant domestic coal stocks, and high imported coal prices. Shipments from two main suppliers, Indonesia and South Africa, fell 17.5% and 9.4% respectively. The import decline deepened in May-June due to the Middle East conflict disrupting shipping routes and pushing up freight costs. Although India’s electricity consumption rose 5.5% in the first half of 2026, growth in renewable energy-based power generation surged 21.9%. This figure is much higher than coal-fired power plants, which grew only 4%, dampening the need for coal imports. BigMint estimates India’s coal imports will continue to decline until the end of 2026. In addition to strong domestic supply, high global coal prices, rising shipping costs, and the increasing share of renewable energy are expected to continue limiting import demand. However, coal imports from Russia have the potential to increase because its prices are more competitive than coal from Indonesia, South Africa, or the United States.