Peak Coal Expectations Return with 2025 Import Dip

Core Insights - Speculation regarding peak demand for hydrocarbons continues, with recent data indicating a 4.4% decline in Asian seaborne coal imports in 2025 from an all-time high the previous year, suggesting a potential peak coal scenario [1] Group 1: Coal Demand and Production - Asian coal imports totaled 1.09 billion metric tons in 2025, down from 1.14 billion tons in 2024, indicating a possible peak in demand in the largest importing region [2] - Despite the decline in imports, China's domestic coal production reached a record high of 4.83 billion tons last year, contributing to the reduced need for imports, which were 490 million tons [3] - India's government is reconsidering its plans to halt coal capacity expansion by 2035, potentially extending it to 2047 due to concerns over the ability of wind and solar to replace coal, which currently accounts for over 70% of electricity generation [4] Group 2: Price Dynamics and Market Trends - Thermal coal prices fell to a four-year low in June last year but rebounded, with Australian coal prices increasing by 16% and Indonesian coal by 12%, which may have weakened import demand [5] - The growth of new wind and solar capacity is slowing, yet it is projected that the combined electricity output from renewables will surpass that of coal for the first time this year [6]