Indian coal demand slump pressures dry bulk market in late 2025

Falling Indian coal demand continues to weigh on the dry bulk market, with power sector demand slipping and stockpiles building across both power plants and Coal India depots. Recent data shows one of the sharpest year-on-year drops in coal-fired generation this cycle, reinforcing a bearish pull on coal imports and voyage demand.

India has emerged as the longest-running demand headwind for the dry bulk market this year. Coal-derived power generation registered its steepest year-on-year contraction since 2020, driven by strong hydro output, higher rainfall and broadly comfortable coal inventories.

Breakwave notes that stocks at Indian power plants have climbed more than 40% compared with last year, while Coal India inventories have also risen sharply as domestic production stays robust.

“Indian coal remains the longest running headwind in the dry bulk market this year,” underscoring how weaker coal generation and swelling stockpiles have constrained import demand.

This combination of soft power-sector coal burn and heavy stock coverage continues to dampen near-term import requirements. With no material pickup in industrial consumption and no weather-related disruptions to coal supply, the outlook for Indian coal imports remains subdued into late Q4.

Source / based on: Breakwave Advisors / Commodore Research