China’s Coal Imports Fall 23% as Domestic Production Soars

China’s coal imports experienced a significant decline of 23% year-on-year in June 2025, totaling 35.61 million tons, according to data from the nation’s customs agency reported by Reuters. This reduction marks a recovery from a two-year low in June, attributed to an impressive surge in domestic coal production that has diminished the necessity for international purchases.

The decrease in coal imports comes as China capitalizes on its robust domestic output. Between January and May 2025, domestic coal production reached record levels, with projections indicating a potential 5% increase in full-year output. This growth in local production has been complemented by a rise in power generation from renewable energy sources, including hydro, wind, and solar, which has further limited coal’s demand in energy generation.

Impact of Domestic Factors on Coal Imports

Several factors have contributed to the declining trend in coal imports. The ongoing crisis in the real estate sector, coupled with sluggish industrial growth, has led to reduced coal demand. Furthermore, the China Coal Transportation and Distribution Association anticipates that coal imports for 2025 could be between 50 million tons and 100 million tons lower than in 2024, reflecting these domestic challenges.

Despite the drop in imports, coal exports from China rose by 13% in the first five months of 2025, indicating a healthy domestic supply. The overall coal purchases in the first half of 2025 fell by 11% compared to the same period last year, totaling 221.7 million tons.

New Coal Power Capacity Approvals on the Rise

After a notable decline in coal power plant approvals in 2024, the trend has reversed in 2025. Recent data from Greenpeace reveals that China approved 11.29 gigawatts of new coal power capacity in the first quarter of 2025. This pace already surpasses the 10 gigawatts approved in the first half of 2024, suggesting a renewed interest in coal-fired generation capabilities.

Last year, the country experienced a significant shift in coal power approvals, with a 41.5% drop in approvals to 62.24 gigawatts, marking the first annual decline since 2021. The current increase in approvals indicates a potential pivot in China’s energy strategy, despite the environmental implications associated with coal power.

Overall, China’s coal market is navigating a complex landscape shaped by domestic production capabilities, energy demands, and evolving policies on energy generation. The current trends underscore the balancing act China faces between meeting energy needs and addressing environmental concerns.