December 8, 2025 - China’s long-term benchmark power-station coal price for 2026 has been set at the same level as this year, according to traders with knowledge of the matter.

Miners and utilities agreed on a price of 675 yuan ($95) a ton, said the traders who asked not to be named disclosing private information. The rate is used to determine the price of coal sold to power generators in annual contracts, around three-quarters of their total purchases, and also influences trading in the spot market.

Chinese thermal coal prices have fallen sharply from a peak in late 2022 as the government encouraged more domestic mining and imports to avoid a repeat of power shortages that disrupted the economy as it emerged from Covid-19. However, local output has stayed at near record-high levels even as prices have declined.

The benchmark price at Qinhuangdao Port fell to as low as 610 yuan a ton in the middle of this year, but has since recovered to above 800 yuan as increased safety inspections cut output and an unusually warm October boosted air conditioning use. Prices dipped in the week through Dec. 1, a rare move for this time of year and a sign that demand is weak as China heads into winter. 

The world’s dirtiest fossil fuel still generates around 56% of China’s electricity, according to BloombergNEF, down from 75% two decades ago. There’s been a massive amount of wind and solar deployed over the last few years, but Beijing still sees coal as an important backstop for intermittent renewables.

Coal prices may rebound slightly next year to a range of 750 to 850 yuan per ton, Chinese brokerage Cinda Securities Co. said in a note on Friday. The strong expansion in coal-power capacity is likely to continue for the next one to three years, and the energy source is then likely to enter a long plateau period after China peaks it emissions in 2030, it said.    

The long-term benchmark coal price includes indexes from major mining hubs for the first time, according to the China Coal Transportation and Distribution Association. This will allow the annual contracts to diverge more from the benchmark, giving more price flexibility, it said.

On the Wire

China’s stubborn steel overcapacity won’t be easy to fix because the industry is so deeply intertwined with the country’s broader economy, according to the head of the World Steel Association.

Beijing and Tokyo traded complaints against each other as their simmering diplomatic spat intensified over the weekend after Chinese fighter aircraft trained their fire-control radar systems on Japanese military jets for the first time.

China’s exports rebounded in November after an unexpected drop the previous month, pushing the trade surplus past a record $1 trillion. Exports rose 5.9% from a year earlier, higher than the median forecast in a Bloomberg survey of economists for 4%. 

This Week’s Diary

(All times Beijing)

Monday, Dec. 8:

• China’s Nov. trade balance and 1st batch of trade data, ~11:00am
  • Crude oil, natural gas & coal imports; oil products imports & exports
  • Iron ore, copper & steel imports; steel, aluminum & rare earth exports
  • Soybean, edible oil, rubber and meat imports; fertilizer exports

Tuesday, Dec. 9:

• China’s agriculture ministry (CASDE) releases monthly report on supply and demand for corn and soybeans

Wednesday, Dec. 10:

• China’s inflation data for November, 09:30am

Thursday, Dec. 11:

• CNPC/Platts annual IEEF summit on oil, gas, energy transition, tech, ESG, Beijing, day 1

Friday, Dec. 12:

• CNPC/Platts annual summit IEEF on oil, gas, energy transition, tech, ESG, Beijing, day 2
• China weekly iron ore port stockpiles
• Shanghai exchange weekly commodities inventory, ~3:30pm local time