Global coal prices moved in different directions over the past week as geopolitical tensions, extreme weather and regional demand conditions shaped individual 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 amid volatile freight rates.
Australian High-CV 6,000 strengthened above 129 USD/t due to renewed military action in the Middle East. Higher summer temperatures in Japan and South Korea, reaching 36°C this week, may also favor increased coal consumption at power plants in these countries.
Australia’s HCC metallurgical coal index tumbled to 229 USD/t. The decline in metallurgical coal prices continued due to a large volume of unsold cargoes, the seasonal steel consumption slowdown in July-August, and prevailing negative expectations among market participants regarding weak demand from major importers. Additionally, coke prices are expected to decline in China, so coke and steel producers will continue to pressure prices.
Australian producer Foxleigh (Queensland) and Japan’s Nippon Steel concluded a forward agreement for July-September 2026 at 181.50 USD/t FOB. Based on a price ratio of around 75% between these coal grades, the deal suggests both sides expect average prices for Australian premium HCC coal to be around 240 USD/t FOB in Q3 2026.
Source: CCA
