Global seaborne coal flows were 116.5 mt in July 2026, up 1% y/y, a small change overall, yet the underlying data below the headline figure points to the two main coal types performing very differently.

Thermal coal flows declined by over 2% to 87.3 million tonnes, while metallurgical coal rose nearly 12% to 27.2 million tonnes. Notably, Asian thermal coal imports remained robust through July, with the top four importers (China, India, Japan, and South Korea) experiencing an 18.3% year-over-year increase. These regions continue to use coal to stabilise grid infrastructure during the typically high power demand summer months, when domestic and industrial cooling is ramped up.

Therefore, the drag on the global demand for seaborne bulk thermal coal flows has come from other regions, mostly Europe and the U.S. These regions have shifted to using a greater proportion of renewables in the energy mix, firstly, and secondly are preferring to run down domestic coal stockpiles rather than enter the market.

Met coal flows in July surged despite India, the largest met coal importer, seeing a decline of 18% y/y. The increase was driven by flows to Japan and China, which saw y/y increases of 24% and 30% respectively. The reasons for increased flows are slightly different, with Japan’s steel sector expected to have begun to turn a corner and China looking to replace volumes that domestic coal mining is missing.

Looking ahead, Signal Ocean data shows that August met coal flows typically increase m/m, as many steel mills open their Q3 procurement budgets. Given met coal flows are currently running close to 6% higher than the same period last year, it is expected that flows in August 2026 will be above that of the same month last year. This is despite weak global steel production, which WSA has currently 0.7% behind the same period last year.

The outlook for thermal coal is similarly positive, particularly with regard to demand from the big four importers. China, Japan and South Korea are experiencing heatwaves, leading to a rising demand for power for cooling. The heat and drought in India have led to much lower hydropower output and more reliance on coal-fired power. This is unlikely to reverse in the very near term.

The knock-on effects for shipping are that tonne-miles of coal-carrying vessels are likely to remain above 2025 levels and may peak above 2023, for the first time this year.