China’s coal imports surged significantly in 2024, reaching a record high of 543 million tons, a 14.4% increase year-on-year. This surge was primarily driven by a significant increase in seaborne imports, which accounted for 431 million tons, representing 31% of all coal transported by sea globally, reports Breakwave Advisors.
Role Of Capesize
Chinese seaborne coal imports witnessed a significant rebound in 2024, particularly for Capesize vessels. Capesize volumes surged by 386% to 59.3 million tons, driven by the resumption of Australian coal imports following the lifting of the import ban. Panamax shipments also saw substantial growth, reaching 255.8 million tons, a 60% increase from the previous year.
Panamax vessels dominated coal shipments to China in 2024, accounting for 59% of the total, while Capesize shipments increased to 14%.
Chinese Capesize coal imports in 2024 were primarily sourced from Australia (66%), Russia, and Colombia. Australian coal imports rebounded strongly following the lifting of the import ban, reaching 39.2 million tons in 2024. However, Australia’s market share in Chinese coking coal imports has declined in recent years due to competition from countries like Russia, Mongolia, and the United States.
While Australian thermal coal exports to China have surpassed pre-ban levels, the overall geopolitical landscape has significantly impacted coal trade flows. The volatile nature of coal trade routes, particularly about Australia, highlights the dynamic and uncertain nature of the global coal market.
Demand Outlook
Imported coal maintained a significant cost advantage over domestic coal throughout 2024, driving increased demand from end-users. This trend was further supported by an improved supply of seaborne coal, with key exporting countries ramping up shipments to China.
In December 2024, the NDRC issued a notice adjusting long-term thermal coal contract requirements, allowing power plants more flexibility in coal procurement by reducing the mandatory contract signing rate. This policy change may introduce some market volatility but provides power plants with greater choice in sourcing coal, including from the imported coal market.
While China’s coal imports have increased significantly in recent years, it is anticipated that import volumes will stabilize in 2025, likely ranging between 500-530 million tons, with seaborne imports estimated to reach 400-420 million tons. This forecast considers the impact of increased domestic coal production and potential adjustments in import strategies.
Although the policy changes and increased domestic production may impact import volumes, the continued cost competitiveness of imported coal and the ongoing need to diversify energy sources are likely to sustain demand for seaborne coal imports in the Chinese market.
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Source: Breakwave Advisors
