April 29, 2026 - This week, the coal market has exhibited a structural pattern characterized by weak stability in production areas, a stalemate at ports, and relative strength in imports. On the surface, trading has been subdued with limited fluctuations, creating an atmosphere of ‘lukewarm’ calm; however, driven by the combined effects of supply-demand dynamics, cost support and shifting market expectations, momentum is quietly building. These short-term adjustments do not alter the positive market trend expected before the onset of summer. Next week, coal prices are set to continue rising.

The Bohai Rim port market remains in a phase of stalemate between bulls and bears, undergoing consolidation and volatility. Market liquidity is moderate, with traders quoting a wide range of prices; enquiries for low-sulphur coal and medium-to-low calorific value coal remain robust. Downstream end-users continue to rely primarily on long-term contract coal for their shipments, whilst procurement of spot coal is gradually increasing. Some traders with high inventory levels and prior profits are showing a slight willingness to sell, fearing that coal prices may fall once the Daqin Railway resumes operations; however, the majority of traders are holding onto their stock and reluctant to sell, giving prices at the Bohai Rim ports the momentum to continue rising in the short term. By the end of April, coal prices will undoubtedly continue to rise. However, whether prices rise or fall after the holiday (early May) will depend primarily on the extent of restocking by end-users during the Labour Day period, as well as the rebound in inventory levels at Bohai Rim ports following the completion of maintenance on the Daqin Railway. Overall, given that both supply and demand in the coal market are driving prices higher and that inventory levels at Bohai Rim ports have not yet built up, the likelihood of a post-holiday price decline is low. Next week, as demand picks up and procurement increases, port coal prices may continue their upward trajectory.

Firstly, end-user demand is performing well. Although this is the off-season for thermal coal consumption, the risk of international energy supply disruptions persists, and the willingness of power sector end-users to procure coal is significantly better than last year, particularly regarding the active fulfillment of long-term contracts. Furthermore, driven by persistently high oil and natural gas prices, coal-based chemical production offers a clear economic advantage, keeping consumption of coal for chemical use at a high level. Additionally, some power stations in southern China are switching from gas to coal.

Secondly, inventories in the mid- and downstream sectors continue to decline. Strong end-user stockpiling and consumption demand, combined with maintenance work on the Daqin Railway line restricting the volume of coal transported in, are contributing to this trend. Since April, inventories have been steadily declining at both Bohai Rim ports and downstream power stations. To date, coal stocks at Bohai Rim ports have fallen by 2 million tons compared to the end of March, and by 4.31 million tons compared to the same period last year.

Thirdly, the domestic macroeconomy is performing well, with growth rates of key macroeconomic indicators rebounding and social electricity consumption maintaining positive growth. Compounded by tensions in the Middle East, soaring oil prices and reduced exports from Indonesia, this has driven an improvement in the domestic market and alleviated supply-demand pressures in the coal sector. The thermal coal market has, surprisingly, seen a ‘five-up, one-down’ price trend during the traditional off-season of March and April. Influenced by this optimistic sentiment, traders have proactively stockpiled goods to speculate on future market movements; their continued absorption of spot resources has also contributed to the price rise.