Commodity: Urea, Coal, En 590, Pellets

Global coal prices correct as European markets fluctuate and Australian coal weakens Global coal prices corrected over the past week as European indices fluctuated and Australian thermal and metallurgical coal weakened. Over the past week, the coal market saw a correction: European indices were volatile; in China prices stood flat; in Australia, both thermal and metallurgical coal became cheaper. In the European thermal coal market, indices traded in a 117-122 USD/t range amid the shifting US-Iran conflict. Early in the week, quotations fell to 117 USD/t due to lower gas prices, as the geopolitical risk premium diminished on the back of the signs of renewed US-Iran dialogue. Furthermore, German electricity prices dropped by 10%, wind generation surged 74%, while coal generation declined 25%. Coal stocks at ARA terminals rose to 4.25 mio t (+0.17 mio t w-o-w). Nevertheless, by the end of the week, coal prices had returned above 122 USD/t. Persistently hot and dry weather in Europe caused water levels on the Rhine to drop to their lowest levels in decades. The gauge fell to 27 cm, down from roughly 65 cm a week earlier, and is forecasted to drop further to about 24 cm by Friday, potentially becoming the river’s lowest level since the 1990s. Barges are operating at approximately one-third of capacity, with freight rates tripling over the past week, constraining coal deliveries to northwestern Europe. Following sharp gains last week, gas quotations on the TTF hub corrected lower to 693.83 USD/1,000 m3 (-37.06 USD/1,000 m3 w-o-w). EU underground gas storage stood at 56% (+2 ppts w-o-w), 11 ppts below last year’s level of 67%. South African High-CV 6,000 weakened to 104-105 USD/t, pressured by limited demand and high inventories at the Richards Bay Coal Terminal (RBCT). Liberty Coal announced the imminent restart of a refurbished separation plant at the Optimum Coal Mine will significantly improve product quality as the company plans to ramp up exports. Liberty is currently processing only through crushing and screening, exporting 5,700 and 4,800 material. The commissioning of the upgraded plant is expected to enable the company to access higher-margin export markets. The first phase is scheduled for commissioning in late August, with management targeting nameplate capacity by October. Initially, the plant will process 0.25–0.30 mio t per month, with subsequent phases increasing capacity to 0.80 mio t per month. In China, spot prices for 5,500 NAR coal at the port of Qinhuangdao stood flat at 122 USD/t. Quotations stabilized in the Chinese thermal coal market. Supply was supported by news of mine suspensions this week because of the ongoing safety inspections, though this was offset by weak demand from end-users, who still see no need to build inventories despite rising temperatures. Peak summer season supported higher daily coal consumption at power plants, but large-scale purchases made by coastal and Yangtze basin stations ahead of summer ensured high inventory levels among end-users. Coal stocks at 9 major ports fell to 28.74 mio t (-1.97 mio t w-o-w), while inventories at 6 major coastal thermal power plants remained at 14.47 mio t (flat w-o-w).

Global coal prices rise amid geopolitical tensions and stronger summer demand Global coal prices strengthened overall during the past week, supported by geopolitical tensions, higher energy prices and stronger summer demand. Upward dynamics prevailed in the coal market over the past week: indices in Europe edged higher; coal in China strengthened; in Australia, thermal material appreciated, while metallurgical coal declined. In the European coal market, quotations firmed to 119 USD/t. Prices found support from oil and gas quotations returning to local highs amid escalating US-Iran conflict. Additionally, numerous Ukrainian drone attacks on port infrastructure and vessels in the Black Sea, including a Turkish coal carrier, that resulted in one crew member killed and three injured — raised concerns over potential disruptions to seaborne supplies in the region. In Germany, lower renewable generation and improved coal-fired generation margins contributed to higher demand and coal consumption. Amid intensified strikes on Iranian and other Middle Eastern infrastructure, as well as Houthi statements about blocking Saudi Arabia, gas quotations on the TTF hub surged over the week to 730.89 USD/1,000 m3 (+78.30 USD/1,000 m3 w-o-w), reaching a 4-month high. EU underground gas storage stood at 54%, 11 ppts below last year’s level of 65%. Coal stocks at ARA terminals increased to 4.23 mio t (+0.48 mio t w-o-w). South African High-CV 6,000 rose to 106-107 USD/t, following the European market amid geopolitical tensions in the Middle East. Coal stocks at the Richards Bay Coal Terminal (RBCT) fell 1.5% to 5.1 mio t, as exports exceeded rail deliveries to the port. Still, inventories remained above the 5-mio t mark for a second consecutive week, reflecting improved performance by state rail operator Transnet this year. However, Transnet moved 1.23 mio t of coal to RBCT over the past week, down 8% from the previous week, though above this year’s average weekly rail volume of 1.17 mio t. In China, spot prices for 5,500 NAR coal at the port of Qinhuangdao rose by 3 USD/t over the week to 122 USD/t, driven by higher coal consumption and heat in coastal and inland regions. Expectations of peak summer demand lifted prices over the past two weeks, though momentum is already softening somewhat amid replenished inventories that may limit new purchases. Few participants expect supply shortages in the near term, citing stable deliveries under long-term contracts and strong import arrivals, despite ongoing safety inspections in major mining regions. However, hot weather in northern Chinese provinces is expected to subside from mid-August. China announced more ambitious renewables targets through 2030, which are expected to reduce coal’s share in the country’s energy mix over the long term. Authorities aim to increase renewable generation capacity to 3,500 GW by 2030, up from 2,340 GW in 2025, with a generation target of 6,000 TWh compared with approximately 4,000 TWh in 2025. Coal stocks at 9 major ports increased to 30.71 mio t (+2.49 mio t w-o-w), while inventories at 6 major coastal thermal power plants remained at 14.44 mio t (flat w-o-w). Indonesian 5,900 GAR firmed slightly above 104 USD/t, while the price of 4,200 GAR corrected modestly higher above 62 USD/t after declining the previous week. Support came from geopolitical tensions, as well as uncertainty over production and sales quota (RKAB) approvals in Indonesia — specifically, the possibility that RKAB volumes may not increase as the market had expected. Uncertainty dominated the Indonesian spot market, as participants attempted to digest the announcement that all coal exports would be fully channeled through a single-window system four months earlier than originally planned. Indonesia’s president stated that exports would be executed through state company DSI starting September 01, 2026, as part of efforts to combat invoice under-valuation, inaccurate reporting, and transfer pricing.

RZD freight tariff hike intensifies pressure on Russia’s struggling coal industry RZD freight tariffs are set to rise earlier than planned, adding further financial pressure to Russia’s struggling coal industry. The Russian government has decided to bring forward a scheduled indexation of Russian Railways’ (RZD) freight rates by three months. From October 01, 2026, rail freight tariffs will rise by 8.5%, whereas the 8.3% increase had originally been planned to take effect on January 01, 2027. The move will enable the state monopoly to generate extra 732 mio USD in revenue this year alone. These funds would effectively constitute additional profit, as they are not tied to any rise in the company’s operating costs. The cumulative increase in freight tariffs over 2022–2025 stood at roughly 81%. Including a 1% surcharge introduced in March 2026 to fund transport security measures, the figure reached about 83%. After the October indexation, tariff levels relative to the end of 2021 will have risen by 98.6% (nearly a 2-fold increase). By comparison, cumulative consumer inflation over the same period, factoring in data for 2022–2025 and H1 2026, stands at around 44.9%. Railway tariffs are thus growing at roughly twice the pace of consumer prices. A shift in the tariff-setting methodology is the key driver behind this divergence. Previously, the ‘inflation minus’ model capped tariff growth at the consumer inflation rate, incentivizing the monopoly to improve efficiency. The new approach, however, links indexation to a composite index based on the carrier’s actual cost structure. Under this framework the monopoly loses any incentive to cut costs, as higher expenses automatically become grounds for further tariff hikes. The coal industry will likely be the hardest hit by the consequences of this decision. Coal remains the single largest commodity shipped on the RZD network, accounting for more than 44% of freight turnover. The combination of high volumes and long hauls makes the industry particularly sensitive to tariff pressure. The most vulnerable routes are those from the Kuzbass basin to ports in the Far East, the Northwest and the Azov-Black Sea basin. Exporters cannot automatically pass on higher tariffs to foreign buyers, so any increase directly squeezes margins or renders specific export routes loss-making. Since 2022, RZD has also scrapped reduced distance coefficients and preferential rates for thermal coal, which had previously been designed to support exporters. These benefits were eliminated at a time of high export prices but have never been reinstated, even as global coal prices subsequently collapsed. In January 2025, a temporary 10% surcharge on empty railcars shipments was introduced and later made permanent. The financial situation in the coal industry remains extremely tough. In Jan-May 2026, the sector posted aggregate losses of 1.50 bln USD, while the share of unprofitable companies rose to 66%. 62 companies are currently in the ‘red zone’, of which 20 have already suspended production and the rest are on the verge of shutting down. Moreover, coal companies are required to repay 646 mio USD to the budget by the end of 2026 – funds they had received as deferrals on mineral extraction tax (MET) and insurance premiums. Against this backdrop, RZD’s H1 2026 revenue grew to 18.8 bln USD (+11% y-o-y). Operating profit rose 34.5% to 3.57 bln USD, while EBITDA surged 24% to 7.08 bln USD. RZD has consistently opposed granting discounts on coal shipments, citing the risk of uncovered losses. Yet there is a precedent for an alternative approach. In 2014, when the Russian economy was going through a challenging period, the government froze tariff indexation for RZD and other natural monopolies for one year to curb inflation and lower borrowing costs. The strategy proved effective: the economy gained breathing room to rebuild reserves, while RZD offset the impact through internal cost optimization.

China coal power rose for a sixth consecutive month in June as weaker wind generation and continued renewable curtailment created additional space for coal-fired electricity. The latest monthly snapshot highlights how weather conditions, grid constraints and expanding thermal capacity continue to influence the world’s largest power market despite the rapid deployment of renewable energy. China’s coal power generation increased by 1.7% year-on-year during June. By contrast, wind generation fell by almost 20% following an unusually weak nationwide wind event, while gas-fired generation dropped sharply as disruptions to natural gas supplies continued. Solar generation continued to expand, while hydropower and nuclear also recorded year-on-year gains, but these were not enough to offset weaker wind output or reduce reliance on coal-fired generation. The analysis also points to the continuing expansion of China’s thermal power fleet. During the first five months of 2026, more than 32 GW of new thermal power capacity was commissioned, an increase of 84% compared with the same period last year. At the same time, additions of solar and wind capacity slowed sharply following exceptionally strong installations ahead of changes to China’s renewable pricing framework. Developments in the coal market reflected tighter domestic supply conditions. Coal production declined during June, while imports increased to help balance the market. Elsewhere, industrial activity remained mixed, with steel output stabilising but cement production continued to weaken, reflecting broader challenges in China’s construction sector. For thermal coal markets, the June figures reinforce an important point: China coal power remains highly responsive to weather conditions and power system requirements. Despite record investment in renewable energy, coal continues to provide essential system flexibility when wind output underperforms. As the world’s largest consumer of thermal coal, short-term changes in China’s power generation mix continue to influence both domestic demand and international coal markets.

Kazakh coal transit through Russian ports rises 34% in H1 2026 Kazakh coal transit through Russian ports increased sharply during the first half of 2026, supported by rail agreements and sanctions exemptions. Transshipment of Kazakh coal through Russian Baltic and Southern ports in January-June 2026 increased to 6.7 mio t (+1.7 mio t or +34.0% y-o-y). The growth stems from agreements reached between Russian Railways (RZD) and Kazakhstan Temir Zholy (KTZ) in April 2025 to increase coal supplies to Russian ports. A crucial role was played by the EU’s decision in July 2025 to exempt transactions with certain Russian ports from sanctions for the purpose of transiting Kazakh coal. Meanwhile, the increase in transit of Kazakh material is occurring on the back of a crisis in the Russian coal industry and lower Russian coal supplies in the northwestern direction. The promised 12.8% discount on RZD’s rail freight tariffs to ports in the Northwest and South was never granted. Furthermore, this route remains unprofitable for Russian coal exporters, facing record losses amid rising transport tariffs, sanctions, and low coal prices. In H1 2026, transshipment of Russian coal via these two routes dropped to 30.0 mio t (-1.0 mio t or -3.3% y-o-y). Combined handling of Russian and Kazakh coal in H1 2026 at the northwestern and southern terminals of Russia totaled 36.7 mio t (+0.7 mio t or +1.9% y-o-y).

Russian coal exports to Turkey fall 26.9% in January–May 2026 Russian coal exports to Turkey declined sharply in the first five months of 2026 as unprofitable shipments and rising logistics costs weakened Russia’s position in the market. In January-May 2026 Russian coal exports to Turkey dropped to 9.5 mio t (-3.5 mio t or -26.9% y-o-y). Meanwhile, in Jan-May 2026, Turkey’s total coal imports, including thermal coal, coking coal and anthracite, totaled 15.0 mio t (-2.3 mio t or -13.3% y-o-y). In Jan-May 2026, Colombia ramped up its deliveries to Turkey to 2.2 mio t (+37.5% y-o-y), while Kazakhstan boosted its coal supplies 2-fold to 1.4 mio t (+100% y-o-y). Russia’s share in Turkey’s coal imports decreased by 11.8 percentage points to 63.3% in Jan–May 2026 (compared to 75.1% in Jan–May 2025). Most producers are forced to export coal at zero or negative profitability. Shipments via southern and northwestern ports are loss-making, while access to rail capacity remains limited amid rising rail tariffs. This situation carries the risk of reducing Russian coal exports’ share in the key remaining markets for Russian suppliers, including the Turkish market, where since 2022 Russian coal has successfully replaced Colombia as the main supplier.

Global coal prices diverged over the past week as geopolitical tensions, extreme weather and regional demand conditions shaped regional markets. Coal market quotations moved in different directions over the past week: indices in Europe strengthened; coal in China edged lower; in Australia, thermal coal prices rose, while metallurgical material continued its downward trend. In the European market, thermal coal indices strengthened above 118 USD/t. Prices found support from military escalation in the Middle East, which pushed oil and gas quotations back toward local highs. The US resumed strikes on Iran and blockaded its ports, to which Iran responded with attempts to block the Strait. Additionally, Trump’s statement about plans to impose a 20% transit fee for cargo passing through the Strait of Hormuz and security measures added to market uncertainty. Exceptional heat in Europe also created a favorable backdrop for energy markets, as demand for generation remained on an upward trajectory. German coal-fired power plant margins increased over the past week due to higher electricity prices. Gas quotations on the TTF hub, amid US strikes on Iran and the blockade of its ports, surged 12.7% over the week to 651.99 USD/1,000 m3 (+73.60 USD/1,000 m3 w-o-w). EU underground gas storage rose to 53% (+2 ppts w-o-w), 10 ppts below last year’s level of 63%. Coal stocks at ARA terminals declined to 3.75 mio t (-0.07 mio t w-o-w). Water levels at Kaub — a critical point on the Rhine determining inland waterway capacity — fell to 45 cm, compared with 72 cm a week earlier. South African High-CV 6,000 rose above 105 USD/t, following the European market. South Africa’s main coal export rail line was temporarily closed on July 15 after civil unrest halted train movements to the Richards Bay coal terminal. The line resumed operations, and scheduled annual maintenance on the North Corridor will proceed as planned from July 21 to August 1. This marks the third disruption to the coal rail line since early June: a major derailment on June 8 that lasted four days, and damage to a section of track between Illangakazi and Ulundi, which was repaired on July 13. In China, spot prices for 5,500 NAR coal at the port of Qinhuangdao corrected slightly below 119 USD/t. Overall, the Chinese thermal coal market is seeing stabilization amid higher coal consumption and expectations that record power demand due to extreme heat will push power plants to build inventories. Heavy rainfall in northern regions caused temporary production halts at several open-pit coal mines, reducing current domestic supply and providing localized support to quotations. Most Chinese provinces are expected to experience about 30 days of extreme heat through mid-August. Over the next ten days, many regions in central and eastern China will see temperatures of 35–38°C for 5–8 days, with some areas potentially exceeding 41°C. At the same time, most market participants remain cautious, believing price gains before summer’s end are unlikely to exceed 20–30 yuan/t (2.95–4.42 USD/t), as signs of potential supply shortages are currently absent. Coal stocks at 9 major ports fell to 28.22 mio t (-0.82 mio t w-o-w). Indonesian 5,900 GAR fell to 104 USD/t, while the price of 4,200 GAR dropped to a low not seen since October 2023 at 62 USD/t. The decline in Indonesian quotations continued due to limited demand from China and India. Southern China continues to feel the effects of a typhoon, which has exacerbated port congestion and all but eliminated the possibility of procurement. Indian buyers continued to hold a wait-and-see stance, as monsoon rains across the country reduced power demand and domestic coal supply covered most needs. Prompt cargoes remained under pressure as position-holding traders sought to offload material at more competitive levels. However, producers were not aggressively cutting prices, awaiting clarity on production quota revisions and prioritizing domestic market obligations. The resumption of Middle East conflict introduced additional uncertainty for demand am

The Russian coal industry remains under severe financial pressure despite tax deferrals and other state support measures. Russian coal companies will return 0.7 billion USD to the federal budget by the end of 2026, funds that were provided to them as deferrals on mineral extraction tax (MET) and insurance premiums, according to Energy Ministry. Some 138 companies were eligible for deferrals totalling 1 billion USD, but only 86 that developed efficiency improvement programmes ultimately received 0.7 billion USD in relief. The programme, launched in 2025, enabled coal producers to postpone tax and social security payments and offered interest-free instalments on accumulated arrears, but the tax breaks have failed to turn the situation around in the industry. The industry’s financial health continues to deteriorate despite state support. Losses of Russian coal companies in 2025 were 3.5 times higher than in 2024. The share of loss-making companies reached 70%, up from 50% a year earlier. In Q1 2026, the net loss kept growing, hitting 1.1 billion USD (+20%, vs. Q1 2025). Sixty-two enterprises are in the red; of which 20 have already halted production, while the rest are on the verge of suspension. Meanwhile, the Ministry of Energy forecasts that losses of Russian coal companies will increase by one and a half times in 2026. Compounding the industry’s woes is the government’s refusal to introduce tariff incentives for export shipments via the northwest and southern ports, which Deputy Prime Minister Vitaly Savelyev announced in late June. Market participants have repeatedly stated that without discounts on rail tariffs, transportation along these routes remains economically unviable; however, the government has concluded that the economic viability of such shipments remains stable even without additional concessions. In April, Energy Minister Sergei Tsivilev said the ministry had no plans for further support measures and that companies unable to cope with the current situation would be liquidated. Meanwhile, in late June, Deputy Prime Minister Alexander Novak instructed the Economy Ministry and relevant agencies to prepare additional support measures for the coal industry, underscoring the severity of the crisis.

Russian rail coal exports to China plunge 29.5% in January–June 2026 Russian coal exports to China through railway border crossings fell sharply during the first half of 2026 amid weak demand and transport constraints. In January-June 2026, Russian railway coal exports to China via border crossings dropped to 5.8 mio t (-2.4 mio t or -29.5% vs. Jan-Jun 2025). The main reasons for the decline in exports to China via border crossings were limited demand from utilities and industrial consumers, along with competition from coal supply on the Chinese domestic market. Oversupply and abnormal weather conditions (the heavy rains observed since May) disrupted logistics and resulted in lower business activity, which caused a temporary slowdown in coal consumption and put downward pressure on domestic prices. Furthermore, extreme weather conditions led to the suspension of operations at numerous industrial facilities and also hampered trading in the coal market because of logistical issues, which limited new deals. Market participants link a possible demand recovery to the onset of summer heat and stricter safety inspections at mines. However, weather forecasts for July show that unfavorable conditions (new typhoons and downpours) are likely to persist, creating additional uncertainty for exporters. On top of muted demand, Russian suppliers faced additional constraints from limited railway capacity towards Chinese border points. The situation underscores a deeper, systemic issue: a long-standing shortage of rail transport capacity on the Baikal-Amur Mainline (BAM) and Trans-Siberian Railway has led to exports being heavily dependent on the infrastructure of a monopoly, which still lags significantly behind market requirements.

Russian coal exports are gaining support from South Korean demand as the country increases coal and nuclear power generation. In January–May 2026, South Korea doubled its coal imports from Russia to 10.2 mio t (+5.0 mio t or +96.2% vs. Jan–May 2025). South Korea’s total coal imports in January–May 2026 surged to 46.8 mio t (+7.6 mio t or +19.4% vs. Jan–May 2025). Because of the energy crisis in the Middle East, South Korea is lifting the 80% cap on coal-fired power plant capacity utilization and increasing nuclear power plant capacity utilization from the current 65–70% to 80%. With rising prices and supply risks for imported LNG and oil, coal and nuclear power generation are strengthening their positions in the country’s energy mix. Furthermore, El Nino is expected to bring an unusually hot summer with record-breaking demand for electricity. Combined with the need to replenish reserves ahead of winter and ongoing disruptions in global LNG supplies, this will drive South Korea to sharply ramp up its thermal coal imports. Under these conditions, South Korea will likely be forced to import thermal coal in 2026 at volumes significantly exceeding the levels seen in the first five months. South Korean coal imports (Jan–May 2026): · Australia: 15.3 mio t (+3.0 mio t or +24.4% y-o-y); · Russia: 10.2 mio t (+5.0 mio t or +96.2% y-o-y); · Indonesia: 10.1 mio t (-0.2 mio t or -1.9% y-o-y); · Canada: 4.6 mio t (+1.1 mio t or +31.4% y-o-y); · South Africa: 2.3 mio t (+0.3 mio t or +15.0% y-o-y); · Colombia: 2.1 mio t (-0.3 mio t or -12.5% y-o-y); · USA: 1.1 mio t (-1.0 mio t or -47.6% y-o-y). Given the crisis in the Russian coal industry, South Korea remains strategically important due to comparatively higher prices than other key markets like China and India. The unprofitability of Russian coal exports keeps growing because of expensive logistics and a strong ruble. Still, producers are trying to maintain their market share, owing to the quality of their material and expectations of better conditions in the medium term, including stabilization of global prices after they hit rock bottom, as well as the expected correction of the ruble exchange rate.

PJM electricity generation during the first major U.S. heat wave of summer 2026 relied overwhelmingly on dispatchable power sources, with coal and natural gas providing the additional generation needed as electricity demand surged to near-record levels. The first major heat wave of the 2026 U.S. summer pushed electricity demand across the PJM Interconnection close to record levels, providing another real-world test of how one of the world’s largest electricity markets responds under extreme conditions. Serving around 67 million people across 13 states and the District of Columbia, PJM recorded demand approaching 160 GW, with a preliminary peak of around 163 GW on 2 July—just below the system’s all-time record set during the 2006 heat wave. The data shows that dispatchable generation carried almost all of the additional load. According to the analysis, nuclear, coal and natural gas together supplied around 88% of total generation during the heat wave. Natural gas averaged approximately 55 GW, while coal ave

Global coal prices showed mixed dynamics over the past week, with European indices continuing to recover, Chinese coal prices softening, Indonesian coal facing weak demand, and Australian thermal coal moving lower. Mixed dynamics persisted in the coal market over the past week: indices in Europe edged higher; coal in China became cheaper; in Australia, thermal material prices fell, while metallurgical coal quotations showed divergent movements. In the European coal market, the recovery continued with quotations climbing to 124 USD/t. Coal found support from above-normal temperatures in Europe, which reduced nuclear generation as warming river waters limited cooling capacity for reactors, while electricity prices climbed to multi-month highs due to air conditioning loads. Further temperature increases are forecast for next week. German electricity prices rose to an average of 158 EUR/MWh, compared with 147.31 EUR/MWh last week. Renewables accounted for 56% of the mix versus 65% a week earlier, while the share of fossil fuels rose from 34% to 44%. Margins for both coal and gas-fired power plants remained positive and increased over the past week. Gas quotations on the TTF hub, amid the heatwave and exchanges of strikes between the US and Iran, rose over the week to 523.79 USD/1,000 m3 (+46.70 USD/1,000 m3 w-o-w). EU underground gas storage rose to 49% (+2 ppts w-o-w), 10 ppts below last year’s level of 59%. Coal stocks at ARA terminals edged up to 3.93 mio t (+0.04 mio t w-o-w), as low water levels on sections of the Rhine River constrained inland logistics and reduced barge capacity by more than half. South African High-CV 6,000 rose following the European market to 107-108 USD/t. Mid-CV material hit a 4-month low, falling below 88 USD/t, as demand from Indian DRI (sponge iron) producers — historically among the most important buyers of South African mid-CV coal — weakened due to high costs, rupee depreciation, and improved availability of domestic coal in India. In China, spot prices for 5,500 NAR coal at the port of Qinhuangdao fell to 124 USD/t, driven by rising inventories at power plants and ports, slower trading activity, and falling import prices. Power plants are well-supplied with coal through long-term contracts and imports, while consumption remains relatively low due to cool weather and high hydropower output. This suggests the potential for significant price gains may be far lower than previously expected, barring an extremely hot spell. According to the five-year energy sector development plan for 2026–2030 published this week, China aims to build a low-carbon energy system that is reliable and efficient. Coal and oil demand is expected to peak within the next five years, after which they will gradually transition to backup energy sources. Coal stocks at 9 major ports increased to 28.83 mio t (+0.37 mio t w-o-w), while inventories at 6 major coastal thermal power plants stood at 14.71 mio t (+0.39 mio t w-o-w). Indonesian 5,900 GAR fell to 107 USD/t, while the price of 4,200 GAR dropped below 65 USD/t, reflecting high inventories in China and persistent rainy weather that did not support active import shipments during the peak summer season. Indonesian-origin coal is being offered at a premium and is meeting resistance from Chinese and Indian buyers due to ample inventories (physical market deals remain limited), so further downside correction is possible to attract buyers. Some Chinese utilities are even delaying spot purchases for July-August in anticipation of lower prices. Demand from Vietnam also proved limited. Indonesia raised its thermal coal reference prices (HBA index) across all grades for the first half of July for the sixth consecutive time, despite weakening demand. Australian High-CV 6,000 fell to 129 USD/t amid easing geopolitical tensions, prompting buyers to adopt a wait-and-see stance. Most inquiries from China came in at discounts or at market prices. Australia’s HCC metallurgical coal index rose to 244 USD/t, supported by renewed buyer interest, though sentiment remained wea

In its latest metallurgical coal market update, McCloskey highlighted how developments in China drove sharp swings in both futures and physical markets, prompting renewed interest in seaborne supply and supporting higher prices for premium hard coking coal. McCloskey reported that its assessment for low-volatile coal MCC1 rose by $3.60/t on the week to $243.00/t FOB Australia, while MCC4 increased by $18.15/t to $261.15/t CFR China. Market direction was heavily influenced by developments in China, where Dalian Commodity Exchange coking coal futures initially weakened before rebounding later in the week. Early pressure came after participants interpreted comments from Shaanxi province on securing summer coal supply as a possible signal of broader coal output support. However, traders later noted that Shaanxi is mainly a thermal coal-producing province, while domestic prime hard low-volatile coking coal supply remained tight. As sentiment softened, offers became limited and traders adopted a wait-and-see approach rather than selling cargoes aggressively. The market then regained momentum after participants shared reports of a mining accident at a premium low-volatile operation in Shanxi. Although no official confirmation had been issued at the time of reporting, the news increased Chinese interest in seaborne premium hard coking coal. Buyers were understood to favour on-the-water or nearby loading cargoes, reflecting concern over domestic availability and uncertainty around future production recovery. In the secondary market, six Panamax cargoes of prime hard material were understood to be available, including premium low-volatile and premium mid-volatile brands for late-June and July loading. Chinese buyers were reportedly open to negotiations around $265.00/t CFR China for Australian material, though laycan timing remained a key factor. Domestic Chinese prices also strengthened, with Shanxi Anze premium low-sulphur coal rising to RMB1,980/t ex-plant including VAT. Stricter safety inspections in parts of Shanxi supported broader price gains, while some East China steelmakers faced reduced deliveries of term-contracted coal and turned to spot supply. At the same time, buying interest for second-tier coals was limited by futures corrections and continued strong Mongolian supply. In the Atlantic basin, demand remained mixed, with some interest from South America and China for Colombian mid-vol coal, while European prompt demand stayed subdued amid logistics constraints and weaker steel production.

Kuzbass coal production declined in January-May 2026 amid rising losses and logistics pressure. Under the Ministry of Coal Industry of Kuzbass, in January-May 2026, coal mining enterprises in Kuzbass produced 77.7 mio t (-4.1 mio t or -5.0% vs. Jan-May 2025). Export supplies from Kuzbass in January-May 2026 totaled 45.5 mio t (+1.9 mio t or +4.4% vs. Jan-May 2025). The fall in global prices, coupled with a rise in production costs and logistics expenses, resulted in increased losses. The share of unprofitable companies reached 63%, compared to 61% a year earlier. 62 enterprises remain in the red zone, of which 20 have already stopped mining, while the rest are on the verge of halting operations. The crisis in the coal industry, on the back of sanctions, high railway tariffs, firming ruble as well as rising costs and logistical constraints, will further adversely affect the production and supplies of high-quality Russian coal to the global market in 2026.

Global coal prices declined over the past week amid weaker sentiment across major coal markets. Negative sentiment prevailed in the coal market over the past week: indices in Europe declined significantly; coal in China remained unchanged; in Australia, high-CV thermal and metallurgical coal became cheaper. In the European coal market, the downward movement intensified over the past week. Quotations fell below 118 USD/t. Pressure on coal came from a sharp drop in gas and oil prices of nearly 20% following the announcement of a US-Iran agreement with the signing of a memorandum of understanding that allowed for the unblocking of the Strait of Hormuz. The deal helped ease concerns over potential energy supply disruptions, though the US president warned that military action could resume if Iran fails to meet its commitments. Gas quotations on the TTF hub fell to 487.14 USD/1,000 m3 (-73.63 USD/1,000 m3 w-o-w). EU underground gas storage increased to 45% (+2 ppts w-o-w), notably below last year’s level of 53%. South African High-CV 6,000 dropped below 108 USD/t, following European quotations. Market participants refrained from trading amid volatility. Interest in South African coal from India remained limited due to weak sponge iron prices over the past six weeks. Meanwhile, rail deliveries of coal for export were recovering after Transnet completed repairs on rail lines damaged on June 8 by a derailment. Both lines were reopened late last week. Exports through the RBCT terminal in May rose 13% month-on-month. However, June volumes are expected to be lower due to the derailment. Rail deliveries were suspended for approximately four days, causing deliveries to the RBCT terminal to fall significantly below the norm (1 mio t per week). Still, RBCT could ship around 62 mio t for export for the full year (+7.5% vs. 2025), exceeding the 60 mio t target. In China, spot prices for 5,500 NAR coal at the port of Qinhuangdao remained flat at 127 USD/t due to persistent buyer resistance to higher prices, which led to reduced activity and limited transactions, although suppliers remained confident about mid-summer demand. Under long-term thermal coal contracts, daily consumption and procurement volumes continued to rise alongside higher generation loads. Overall, trader sentiment was mixed. Some participants maintained high price expectations, supported by tightening supply at the mining level and expectations of peak seasonal demand. Conversely, others were increasingly inclined to sell due to rising inventories, sufficient availability of prompt-delivery import cargoes, and falling import coal prices. On June 15, Chinese authorities mandated that nine key coal-consuming sectors (power generators, steel, aluminum, cement producers, etc.) carry out upgrades in 2026–2028 to improve energy efficiency by an average of 20%. The goal is to reduce coal consumption by 100 mio t/year and cut CO₂ emissions. Inefficient capacity is expected to be phased out gradually. Coal stocks at 9 major ports edged down to 28.33 mio t (-0.11 mio t w-o-w), while inventories at 6 major coastal thermal power plants stood at 13.97 mio t (+0.24 mio t w-o-w). Indonesian 5,900 GAR rose above 109 USD/t, while the price of 4,200 GAR strengthened to nearly 67.5 USD/t. Demand for Indonesian material from Chinese consumers is rising amid tighter safety inspections, following the May 22 tragedy in Shanxi. The upward trend in Indonesian material quotations continues. However, price gains are slowing alongside demand in India and China, where coal supply and inventory levels are high. Indonesian coal exports recovered over the past week thanks to increased shipments to India and other countries, while exports to China remained broadly stable. Loading in Kalimantan and Sumatra also remained relatively smooth. Preliminary data shows exports reached 8.8 mio t (+14% w-o-w and +6% y-o-y), above the 24-week average of 8.4 mio t. In the first 24 weeks of 2026, Indonesia shipped 202 mio t of coal (-18 mio t or -8% y-o-y). Australian High-CV 6,000 fell to 141 USD/t, retr

Asian coal demand is set to increase sharply as LNG supply disruptions and higher gas prices force utilities across the region to rely more heavily on coal-fired generation. While many countries remain committed to long-term energy transition goals, the latest market analysis suggests coal continues to play a critical role when energy security comes under pressure. According to new research by Rystad Energy, Asia-Pacific thermal coal consumption could increase significantly over the remainder of the decade, with around half of the additional demand expected to occur in 2026 alone. The increase is being driven by tighter LNG markets following damage to Gulf energy infrastructure and the resulting reduction in LNG exports to Asia. The analysis estimates that LNG supply disruptions could leave Asia facing a gas shortfall of around 35 million tonnes this year. As utilities seek alternative sources of power generation, existing coal-fired plants are being dispatched more frequently, particularly in gas-dependent economies across Northeast and Southeast Asia. The report argues that the shift is not the result of a broader policy reversal or a renewed wave of coal investment. Instead, it reflects the practical realities of maintaining reliable electricity supplies when gas markets become constrained. In several countries, regulatory limits on coal plant utilisation have been relaxed, allowing operators to increase output from existing assets. Japan, South Korea and Taiwan are expected to account for a significant share of the additional coal demand, while Vietnam, Thailand and the Philippines are also projected to increase coal consumption as utilities respond to tighter gas balances. China is expected to remain comparatively insulated due to the relatively limited role of gas in its power sector. The findings reinforce a theme that has emerged repeatedly during recent energy market disruptions: coal remains an important backstop for electricity systems when alternative fuel supplies become unavailable or prohibitively expensive. While renewable capacity continues to expand across Asia, the report notes that coal is still frequently called upon to support power systems during periods of market stress. For coal producers and traders, the key question will be whether the current increase in demand remains a temporary response to LNG market disruption or evolves into a longer-lasting shift in fuel consumption patterns. For now, the evidence suggests the market response is being driven by energy security concerns rather than any fundamental change in long-term policy direction.

Indonesian coal demand has surged to a record monthly high even as the government attempts to curb domestic coal production. New data suggests growing demand from smelters, power generation and downstream processing industries is tightening the domestic market and reshaping coal flows across the country Indonesia is recording its highest-ever monthly coal discharge volume, highlighting the growing strength of domestic coal demand despite government efforts to reduce production. According to DBX Commodities, coal discharge volumes reached 3,203 kT in May 2026, representing an all-time high and standing 163% above the five-year seasonal average. The trend comes as Jakarta seeks to reduce coal output to approximately 600 million tonnes in 2026, around 24% below last year’s production levels, in an effort to support coal prices following a period of oversupply. However, domestic demand is expanding rapidly. Coal consumers that are unable to secure sufficient local supply are increasingly competing for available volumes, while growing industrial activity continues to lift consumption. A key driver is Indonesia’s downstream minerals strategy. The country’s 2020 nickel ore export ban triggered significant investment in domestic smelting capacity, creating a growing appetite for coal. Nickel and metals processing operations now account for an estimated 31% of domestic coal consumption, with additional demand expected from ongoing industrial expansion and power sector growth. The result is a striking contradiction. While authorities are attempting to restrict supply to support export prices, rising domestic demand is simultaneously pushing coal volumes through the local market at record levels. The latest data highlights the increasing importance of Indonesia’s industrial sector in shaping coal demand trends and suggests that domestic consumption could become an even more significant factor in the country’s coal market over the coming years.

Global coal prices continued to rise over the past week across Europe, China, Indonesia, and Australia. Over the past week, the upward trend in the coal market continued: indices rose in Europe; coal became more expensive in China, following the May 22 tragedy; in Australia, prices strengthened for both thermal and metallurgical material. In the European coal market, spot quotations continued their advance to 128 USD/t. Supportive factors included expectations of higher solid fuel demand during the summer amid gas price volatility, stemming from uncertainty over the US-Iran crisis; physical market deals continued by a major international trader (two deals were recorded this week at 124 and 127 USD/t DES ARA for June delivery); and the Indonesian government’s plans to take control of coal export shipments. Gas market in Europe remained highly volatile due to periodic exchanges of strikes between the US and Iran despite a previously announced truce, as well as news that Tehran had received an unofficial draft memorandum of understanding with the US under which Iran would commit within a month to restoring commercial shipping through the Strait of Hormuz to pre-war levels, while the US would lift its naval blockade. Gas quotations on the TTF hub stood at 563.84 USD/1,000 m3 (-8.72 USD/1,000 m3 w-o-w). EU underground gas storage increased to 38.8% (+2.1 ppts w-o-w). South African High-CV 6,000 corrected below 120 USD/t, continuing to hover near its highest levels in 2.5 years. Indices continue to find support from news of Indonesia’s plan to nationalize coal exports. Traditional buyers of Indonesian material may potentially shift to other supply sources. South African 4,800 NAR coal, in particular, competes with Indonesian coal in the key Indian market. In India, thermal coal buyers continue to shun imports. Several sponge iron producers stated that a sharp drop in their product prices has made imported material somewhat unprofitable, prompting them to gradually scale back purchase volumes. In China, spot prices for 5,500 NAR coal at the port of Qinhuangdao rose to 124 USD/t. Coal mining regions in China have stepped up safety inspections following a gas explosion on May 22 at the Liushenyu coal mine (metallurgical coal mine with 1.2 mio t/year capacity) in Shanxi province, which killed 82 people, left two missing, and injured 128. The government ordered at least 118 enterprises in Shanxi province with total capacity of 134.5 mio t/year, mostly producing metallurgical coal, to suspend operations for safety checks. Similar suspensions and inspections followed in Shaanxi and Inner Mongolia. Experts estimate that China’s production could decline by 10-15 mio t in June alone. For the full year, coal output could fall 1-2% compared with the 4.83 billion tons mined last year, largely due to a 5-10% drop in coking coal production. The thermal coal market is not expected to be impacted to the same extent, as China’s central government will continue its policy of ensuring adequate supply during the summer. Thus, the current price rally is likely to be short-lived: most suspended mines are expected to resume operations next week. Coal stocks at 9 major ports increased to 28.32 mio t (+0.80 mio t w-o-w), while inventories at 6 major coastal thermal power plants stood at 13.44 mio t (+0.58 mio t w-o-w). Indonesian 5,900 GAR climbed to 107 USD/t, while the price of 4,200 GAR strengthened to nearly 65 USD/t. Demand for Indonesian material is rising from Chinese consumers amid tighter safety inspections following the May 22 tragedy in Shanxi. Market participants continue to analyze Indonesia’s plans to create a state body that will control all coal exports. According to a briefing by Indonesian authorities on May 26, exporters will be able to continue their normal activities from June 1 but must report deals to Danantara Sumber Daya Indonesia (DSI), providing the organization with all documentation, financial data, and counterparty information. From January 01, 2027, DSI is expected to take over as the official exporter for con

US coal production remained largely unchanged in the week ended May 23, 2026, with output slightly above the previous week but marginally below levels recorded a year earlier. Year-to-date production continues to track close to 2025 levels despite ongoing market uncertainty. Estimated US coal production totalled approximately 9.6 million short tons (MMst) in the week ended May 23, 2026, according to the latest data from the US Energy Information Administration (EIA). US coal production trends by region 20252026 Production was 0.4% higher than the previous week’s estimate, but 0.7% lower than the comparable week in 2025. Coal production east of the Mississippi River totalled 4.1 MMst, while production west of the Mississippi River reached 5.5 MMst. On a year-to-date basis, US coal production stood at 205.7 MMst, which is 0.5% below the comparable period in 2025, indicating that overall output remains relatively stable despite regional fluctuations. The EIA data shows western coal-producing regions continue to account for the largest share of US coal output, while Appalachian and Interior basin production has remained broadly steady over the past 12 months.

Net losses of Russian coal companies in January-March 2026, according to preliminary data, amounted to 1.1 bln USD, up 0.2 bln USD or 20% y-o-y. The share of unprofitable companies reached 63%, compared to 61% a year earlier. 62 enterprises remain in the red zone, of which 20 have already stopped mining, while the rest are on the verge of halting operations. Companies’ performance is deteriorating due to several negative factors, including transportation costs, as Russian Railways (RZD) raises tariffs: in 2025, the increase spiked 13.8% (despite official inflation of 5.6%), and in March 2026, a 1% surcharge was introduced, in January 2027 the tariff will be raised by 8%, with further indexation expected. In addition, the ruble was strengthening again, and bank interest rates remained high, placing significant pressure on coal producers and exporters, while also increasing the debt burden. Debt burden by the end of 2025 reached 18 bln USD (+5.1 bln USD or 40% y-o-y). Despite this, the government does not plan to extend the deferment on mineral extraction tax (MET) and insurance premium payments beyond April 2026. In this regard, the Ministry of Energy forecasts that losses of Russian coal enterprises will rise to 7 bln USD in 2026, which is 27% higher than in 2025. Thus, in 2026, the negative trend in the Russian coal industry is intensifying amid rising production costs and ruble appreciation. Additional factors continuing to adversely affect coal companies’ financial results include high rail tariffs and limited rail infrastructure capacity on the Eastern range. Due to Western sanctions, the list of countries available for Russian coal exports remains limited.