Asian thermal coal market firms as Chinese buying picks up, Indonesian supply tightens

• Sustained East Asian offtake offers steady price floor
  
  
• Indian pre-monsoon restocking remains selective
  
  

Asian thermal coal markets gained traction in the final week of April (ended 27 April 2026), supported by a noticeable increase in Chinese buying interest and persistent supply constraints from Indonesia, even as Indian demand remained selective and South African prices softened.

Price increases were broad-based across calorific value ranges, with Chinese tenders for Indonesian coal showing higher acceptance levels and regional buyers in Vietnam, the Philippines, and South Korea maintaining steady offtake.

Indonesian low-rank coal leads gains

Indonesian coal prices moved higher across all major grades in the week ending 24 April. The 4,200 kcal/kg GAR grade -- a benchmark for Indonesian exports -- was assessed at $60.70/t FOB Kalimantan on 23 April, holding near recent highs. Assessments for 3,800 kcal/kg GAR rose to $48.85/t FOB, while 5,000 kcal/kg GAR climbed to $78.25/t FOB.

For 4,200 kcal/kg GAR, offers for second-half May loading cargoes were heard between $61-64/t FOB on Panamax and Supramax vessels, while bids clustered around $58-62/t. For 3,400 kcal/kg GAR, indications for May loading Supramax cargoes ranged from $41.45-41.95/t FOB for branded material.

Suppliers of 5,000 kcal/kg GAR sought $81-84/t FOB for branded Panamax cargoes, though buyer bids were heard as low as $77/t, indicating resistance at higher levels.

China tender activity picks up

Chinese buyers showed increased activity, with tenders for Indonesian coal rising in both volume and price levels. In the 3,800 kcal/kg NAR segment, offers into South China were heard between RMB 554-572/t DDP for May-June delivery, up from RMB 539-558/t a week earlier.

Australian 5,500 kcal/kg NAR coal was traded at $112.50/t CFR South China for June delivery in an unconfirmed transaction. At current exchange rates, this equates to approximately RMB 815-820/t CFR, suggesting import parity may be returning after months of disadvantage.

Chinese domestic QHD FOB markers rose across all grades. The 5,500 kcal/kg NAR marker reached $113.62/t (RMB 780/t), up 3.5% from late March. Coastal freights spiked sharply, with Qinhuangdao to Shanghai jumping 29.8% to $6.18/t ahead of the Labour Day holiday.

Indonesian supply remains constrained

Supply-side fundamentals in Indonesia remained tight. The government has approved approximately 580 million tonnes (mnt) of coal production for 2026, well below the 790 mnt produced in full-year 2025. Many miners have not yet received production approvals, putting pressure on May spot availability.

Miners are increasingly selling into the domestic market, where smelter demand remains strong, reducing export allocations. The spread between 3,400 kcal/kg GAR and 4,200 kcal/kg GAR has widened to approximately $20/t, leaving room for lower grades to rise further.

India demand selective, South Africa softens

Indian buying remained selective. Power and cement buyers showed a preference for Russian and South African cargoes over Indonesian material. Pre-monsoon restocking has been slower than usual, with industrial activity tempered by Middle East uncertainty. Power plant coal stocks stood at 56.5 mnt on 21 April, sufficient for over 18 days of consumption.

FOB Richards Bay 5,500 kcal/kg NAR was assessed at $89.70/t on 23 April, down $2.45/t from a week ago. Bids for May loading were heard at $88-89/t FOB, with limited concluded deals.

Regional demand supports mid-CV flows

Vietnam and the Philippines continued to show persistent demand for low- to mid-CV Indonesian coal, with buyers paying substantial premiums. South Korea remained active in high-CV coal, preferring Russian material on pricing. Japan and Taiwan focused on term contract volumes.

Ocean freights added cost pressure, with Panamax freights from Kalimantan to India's west coast rising to $13.55/t, up 40 cents on the week.

Outlook

The Asian thermal coal market enters May with a firmer tone. Chinese tender activity is picking up, Indonesian supply remains constrained, and regional demand provides a steady floor. However, Indian restocking has disappointed, South African prices are under pressure, and further Indonesian production quota approvals could ease tightness. The Middle East conflict remains an overarching uncertainty.