Asia's seaborne thermal coal market is shrinking very slowly
XLE•Asia's seaborne thermal coal imports fell from 898.2 million metric tons in 2024 to 856.3 million in 2025 and are on track to decline again in 2026. Industry participants expect supply to fall modestly faster than demand, with prices likely to stay relatively stable but remain volatile.
1. Supply and demand ease
Asia's seaborne thermal coal market is facing gradual declines in both demand and supply, with the pace of each expected to shape prices. The region accounted for nearly 90% of seaborne trade in recent years; imports peaked at 898.2 million metric tons in 2024 and fell to 856.3 million in 2025.
2. Indonesia's production outlook
Indonesia produced around 790 million tons of coal in 2025, and the government has instituted cuts for 2026 to limit exports and lift prices. The consensus is for output to fall by around 60 million tons, while some industry representatives believe the government wants to cap production at about 700 million tons a year. Domestic coal sales grew at an 11.1% compound annual rate from 2015 to 2025 and now represent 31% of Indonesian coal demand.
3. Import demand trends
China and India are expected to moderate seaborne imports as domestic production recovers, though India may buy more coal for industrial use. Japan and South Korea are likely to reduce imports over time as coal plants retire, while demand growth from smaller buyers is unlikely to offset declines among the four largest importers. Industry participants expect supply to decline slightly faster than demand, keeping prices relatively stable while leaving them exposed to unexpected disruptions.
