Russell: China, Japan and South Korea are the main buyers of thermal coal in Asia.
Asia's seaborne thermal coal imports are rebounding, as China increases purchases to compensate for a soft domestic production and Japan and South Korea look for energy security amid the fallout of the U.S. and Israeli war on Iran.
According to commodity analysts Kpler, imports in the top energy-consuming region are expected to hit 77.37 millions metric tons by June, which is up from 68.39 in May.
The 'June' figure is up 22.3% compared to the 63.24 millions tons of the previous year.
The gains were driven by Japan and South Korea. These two developed economies are the most capable of switching between coal and LNG.
After the U.S., Israel and Iran attacked Iran on 28 February, Tehran closed the Strait of Hormuz effectively. This left Qatar with 20% of the global LNG supply.
Spot LNG delivery to North Asia
The price has dropped to $15.30 a mmBtu for the week ending June 19 but is still 47% higher than its pre-war levels.
Newcastle Port's price for high-grade Australian coal also increased.
GlobalCOAL assessed the grade at $134.09 per tonne on Wednesday, 15.7% higher than pre-war levels.
Since the Iran War began, thermal coal is cheaper than LNG. This dynamic can be seen in the flow rates.
Kpler predicts that Japan, the third largest coal importer in the world, will record arrivals in June of 7.82 millions tons of thermal coal, up for the third consecutive month and 33% over the 5.89 in the same month last year.
South Korea's thermal coal imports are expected to reach 7.30 million tonnes in June, the highest since January and 41% more than the 5.16 millions in the same month of 2025.
CHINA RETURNS TO IMPORTS
Kpler predicts that China, which is the top coal buyer in the world, will also buy more. The 27.65 millions tons of seaborne thermal coal expected to arrive by June are a six-month record and a 48% increase from the 18.62 from June 2025.
China's increased imports are not related to the conflict in Iran, but rather reflect market dynamics on its own domestic markets, where a stronger demand for thermal power generation collides with a softer coal production. According to official data, China's thermal energy generation, which is dominated by coal and a small percentage of natural gas, increased 2.1% in may, bringing the total gain for the five months to the year up to 3.4%. The coal production dropped by 1.7% from the previous year to 397.22 millions tons, and was down 0.3% in the first five months of the year to 1.98 billion tonnes.
Safety inspections were conducted in China after a deadly mine accident in which 82 people died. This led to a drop in production and a rise in domestic prices.
Thermal coal in?Qinhuangdao
This price makes both low-grade Indonesian coal, and mid-grade Australian, competitive with Chinese domestic coal supplies. It encourages utilities to increase seaborne imports.
India, the second largest coal importer in the world, has not been purchasing more coal.
The seaborne arrivals are expected to be 12.32 million tonnes in June. This is the same as May's 12,27 million, but lower than the 14.14 millions recorded a year ago.
Indian power generators are unlikely to have bought more coal due to higher prices, despite the fact that domestic production has been struggling to increase this year.
India instead is relying on its coal reserves and boosting the production of renewable electricity, which grew by 29.3% from the same month in 2025, reaching a record 17,9% of total country generation.
You like this column? Open Interest (ROI) is your new essential source of global financial commentary. ROI provides data-driven, thought-provoking analysis on everything from soybeans to swap rates. The markets are changing faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, X.
These are the views of a columnist who writes for.
(source: Reuters)
