China's domestic thermal prices are expected to remain broadly steady in 2026, staying close to the state-guided pricing level, said Wu Wenbin, Manager of Guangdong Energy Group Co., Ltd., at Coal Market Outlook 2026 & Sxcoal Annual Conference held in Nanning, Guangxi on December 25.

Wu stated that approximately 320 TWh of thermal power capacity is projected to be added by the end of 2026, with the increase likely stemming primarily from thermal power facilities outside the statistical scope. This will correspondingly increase raw coal consumption by 120 million tonnes, he added.

He estimated China's coal consumption in 2026 at around 4.87 billion tonnes, representing a 2.5% increase. Meanwhile, supply is forecasted at around 4.9 billion tonnes, indicating a slight surplus.

Imports remained under downward pressure. However, gradual commissioning of new thermal power units, particularly those in coastal areas, could potentially support demand.

Meanwhile, the slowdown in economic growth and growing output from new energy sources could lead to a significant deceleration in consumption growth, even resulting in negative growth, he said.

As of December 18, the cumulative annual coal consumption for power generation and heating by major coal-fired enterprises nationwide decreased by 4.6% from a year ago, data showed.

As thermal coal consumption accounts for over 60% of total coal consumption, a significant slowdown may substantially suppress overall coal consumption levels, Wu said.

Given the domestic and international landscapes, Wu noted that the national-level objective of regulating coal prices is clear, making a price collapse unlikely. The spot coal prices are expected to stabilize within a reasonable range (570-770 yuan/t FOB), which aligns with national expectations.

He added that utilities are also not happy to see a collapse, as a huge price dive may trigger policy interventions and market panic. Prolonged decline in spot prices would also pose challenges for fulfilling medium-to-long-term coal supply contracts and regulatory compliance.

In conclusion, Wu forecasted the spot prices for 5,500 Kcal/kg NAR spot thermal coal at northern China ports to stay between 600-700 yuan/t FOB in 2026, hovering near to the state-guided pricing level.