China coal import slowdown hits Indonesian supply harder than Australia
Thursday, May 14 2026 - 09:41 AM WIB
By Dominikus
Indonesia has absorbed the largest decline in China’s thermal coal import slowdown this year, while Australian coal shipments have remained more resilient, McCloskey by OPIS said at last week’s Indonesia Miner Conference.
Scott Dendy, Executive Director, Coal, Metals and Mining at McCloskey by OPIS, said Chinese thermal coal imports fell to 90.76 million tons in the first 18 weeks of 2026, compared with 106.60 million tons in the same period of 2025.
The figure represented a decline of 15.84 million tons, or 15% year-on-year, according to McCloskey data presented at the conference.
Imports from Indonesia into China dropped to 58.47 million tons in the first 18 weeks of 2026 from 67.96 million tons in the same period last year, down 9.49 million tons or 14% year-on-year.
By comparison, China’s imports from Australia declined to 18.09 million tons from 20.54 million tons, down 2.45 million tons or 12% year-on-year. Imports from Russia fell to 9.40 million tons from 12.32 million tons, down 2.92 million tons or 24%.
Despite the volume decline, Indonesia’s share of China’s thermal coal imports rose slightly to 64.4% in the first 18 weeks of 2026 from 63.7% in 2025. Australia’s share also increased to 19.9% from 19.3%, while Russia’s share declined to 10.4% from 11.6%.
On a weekly average basis, China’s thermal coal imports fell to 5.04 million tons in 2026 from 5.92 million tons in 2025. Average weekly imports from Indonesia declined to 3.25 million tons from 3.78 million tons, while imports from Australia slipped to 1.01 million tons from 1.14 million tons.
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Meng Meng, Principal Analyst at McCloskey, said in a separate presentation that China’s import weakness has been concentrated in Indonesian coal, with imports of Indonesian thermal coal down by around 8 million tons in January-April.
Australian volumes were relatively more resilient, supported by quality demand, while Russian seaborne flows were also softer by around 1 million tons year-on-year, although competition remained in southern China.
Meng said Russian exports to southern China increased, competing with Australian and Indonesian coal. Inner Mongolia lignite of around 3,000 kcal NAR is also being sold into the Yangtze River region amid tighter Indonesian supply.
She said China’s coal market is being shaped by a combination of short-term supply shocks and Beijing’s longer-term policy tightening. Southern China power plants face gas shortages and higher freight costs for seaborne coal, while electricity prices have surged.
At the same time, China’s imports of Indonesian thermal coal have weakened as Beijing sees limited ability to absorb a cut in Indonesian supply to 600 million tons without allowing domestic prices to rise.
Meng said Beijing may allow domestic coal prices to float at RMB900-RMB1,000 per ton, or around US$131-US$146 per ton, in summer 2026 to support production, compared with around RMB850 per ton previously.
The National Development and Reform Commission has also ordered generators to lift inventories by 30 million tons, while stocks stood at 190 million tons as of April 23, according to the presentation.
McCloskey said China’s domestic coal supply remains tight, with stricter safety inspections since the second half of 2025 limiting output flexibility. Production growth is expected to rely mainly on new mine commissioning rather than expansion at existing operations.
Meng estimated China’s thermal coal output would increase by only 20 million to 30 million tons in 2026 to around 3.85 billion tons, representing 0.6% year-on-year growth.
For Indonesian miners, the outlook points to rising competition from Russian coal in southern China and Mongolian supply in northern China, while renewables are expected to increase volatility in coal burn and import timing.
However, McCloskey said near-term demand for high-CV Indonesian coal may receive support from generator stockpiling for summer, weaker renewable or gas generation in China, and potential demand recovery during the July-September peak season.
Editing by Reiner Simanjuntak