Global coal demand and production hit record highs in 2024. Demand is expected to plateau through 2026, while production is projected to set another record in 2025 before declining in 2026. Coal trade volumes also reached new highs in 2024 and are forecast to fall in both 2025 and 2026. This is reflected in prices, which have eased to near marginal supply costs after the 2021–2022 spike.
Global coal demand rose by 1.5% in 2024 to 8.79 billion tonnes (Bt), a new record. However, this was the slowest annual growth rate since the decline in 2020 during the Covid-19 pandemic. The post-pandemic recovery and higher natural gas prices have driven robust increases in global coal demand in recent years. Demand has risen by more than 16% cumulatively since 2020 even though the year-on-year growth rate has slowed since 2021.
While trends in some major coal-consuming regions diverged in the first half of this year from earlier expectations, our full-year forecast for global coal demand in 2025 is little changed from the one published in our annual Coal 2024 report in December 2024. The structural drivers underlying global coal demand remain the same, both in the electricity and industrial sectors. The changes at the regional level compared with our December forecast cancel each other out in the wider global picture. In China and India, coal demand is set to be weaker than previously foreseen, but this is offset by higher-than-expected demand in the European Union and United States. As a result, global coal demand is still forecast to rise slightly in 2025.
Developments in China will largely shape global coal trends. In our current forecast, China’s coal demand declines slightly in 2025 and recovers slightly in 2026, getting close to 5 billion tonnes (Bt).
In 2024, global coal production reached a record 9.15 Bt, driven by China and India, where domestic output is both the main energy source and a core energy security priority. Following shortages in 2021, both countries expanded production for several years. Despite sluggish demand and high inventories, continued expansion of production in China and India could push global output above 9.2 Bt in 2025.
Given the current landscape of abundant supply, low prices and projections indicating broadly stable coal demand through 2026, we expect global coal production to decrease across all major producing nations next year – with the important exception of India. In China, with very high stocks throughout the supply chain and no expected rebound in demand, we expect a decline in 2026, the first since 2022.
In 2024, coal trade volumes surpassed 1.5 Bt for the first time. China – the first country to exceed 500 Mt of imports in a single year – remains among the largest importers, together with India, Japan and Korea. On the supply side, Australia has maintained its position as the leading supplier of high-value coking coal, while Indonesia has proven the most flexible exporter, becoming the largest by far with more than 550 Mt exported in 2024.
Global trade volumes are likely to decrease in 2025. With most major importers cutting back, an expected drop in China’s imports – amid abundant stocks and sluggish domestic demand – is set to weigh particularly heavily on global coal trade. On the supply side, most exporters will see their volumes shrink. Indonesia, the largest supplier to China, is expected to see the largest decline.
Moreover, we do not expect a rebound in 2026 in coal imports to China, which has been the main growth engine for international coal trade in previous years. More broadly, coal imports in most importing countries are forecast to continue declining in 2026, resulting to another drop in global coal trade in 2026 and marking an unprecedented second consecutive annual decline this century. On the supply side, most exporters will struggle amid low prices and weak demand, although Australia can buck the trend if its metallurgical coal mines return to operation.
After their Covid-19 lows in 2020, coal prices soared, peaking in 2022 due to Russia’s full-scale invasion of Ukraine and the resulting energy supply disruptions. More recently, China’s coal production has outpaced demand, boosting inventories and putting downward pressure on prices domestically and internationally. As a result, thermal coal prices in the first half of 2025 dropped to their lowest level since 2021. These low prices and weak demand are hurting producers, and hence, some of them are announcing output cuts.
