China’s thermal coal prices have climbed to their highest level of 2025, driven by both seasonal restocking and broader economic and policy shifts that have strengthened demand. The Qinhuangdao benchmark rose to 788 yuan ($111) per ton, up more than 10% over the past month, according to the China Coal Transportation and Distribution Association (CCTDA). The rally reflects winter restocking by utilities combined with prolonged safety inspections that have slowed mine output. Renewed confidence following a trade truce with the United States is also helping.
The market is also encouraged by signs that Beijing’s stance on coal consumption has softened. The government’s new five-year plan no longer specifies a firm date for peaking coal use, suggesting a longer runway for demand. The China National Coal Association forecasts steady growth through 2026, with coal demand plateauing only around 2030.
Despite the current price strength, Qinhuangdao prices remain about 7% below year-ago levels, underscoring the lingering impact of surging domestic production since shortages earlier in the decade. Renewables’ rapid expansion in China means that coal generation dips if power demand growth underperforms, and so we are optimistic on Chinese thermal coal prices, but somewhat cautious that we’ll see a big lift off.
Bloomberg Intelligence forecast that Qinhuangdao prices will average 660 yuan per ton in 2026, with upside limited to around 850 yuan, as rising output caps gains. We at TCT believe that prices are likely to trend towards the top of that range (850 yuan, or ~114/mt).
Of course we are entering heating season, so TCT will be watching weather in China closely. China’s National Climate Center forecasts near-normal or above-average winter temperatures, potentially reducing heating-related coal demand. However, below-average rainfall could curb hydropower output, offsetting any dip in coal demand due to temperatures.
-TCT
