Russia amplified coal shipments to China during May
In a surprising turn of events, Russian coal exports to China, once a significant portion of Russia's total exports, have witnessed a sharp decline in 2025. This shift, far from being driven by weather conditions or production losses, is largely attributed to economic, geopolitical, and policy-related factors.
According to NEFT Research, the price of Russian energy coal on the Asian market has dropped to a four-year low due to an excess of supply and reduced imports by key consumers. This decline in demand has contributed to the decreased exports to China, with the country's market share of Russian coal imports dropping from 23% in 2023 to 18% in 2024.
One of the primary reasons for this shift is China's rebalancing of its energy sector towards cleaner sources. The country's domestic coal sector faces persistent overcapacity, leading to weaker coal demand. This rebalancing is reflected in the decline of China's coal production by 2% year-on-year in April and May, as reported by various sources.
Another significant factor is the impact of sanctions on Russia. The financial and operational stress caused by these sanctions threatens closures of many coal enterprises in Russia, further reducing its ability to export coal to China.
The decline in Russian coal exports to China is also reflected in the overall Chinese coal imports, which showed a large year-over-year decline (-23%) in July 2025, despite a month-to-month increase (+7.8%). This suggests broader shifts in import patterns that are unrelated to weather or production losses of Russian coal specifically.
Interestingly, Russia's coal exports to other markets, such as Turkey and South Korea, have increased. In May, Russia exported 4.58 million tons of coal to China, the highest monthly figure since the start of last year, while exports to Turkey and South Korea increased by 10% and 2.1 times, respectively, compared to the same period last year.
Despite this, the situation poses risks for future Russian coal exports to China, as noted by Yevgeny Grachev, Director of the Coal and Mining Institute (CPI). Grachev also mentioned the possibility of controls on import volumes being introduced in China, which could further impact Russian exports.
In contrast, NEFT Research suggests that South Korea could be a promising direction for future Russian coal exports, as prices for high-calorie coal in South Korea have been rising due to high demand and new tenders. Concerns about sanctions against Russian coal in South Korea appear to have weakened, according to NEFT Research analysts.
Meanwhile, Poland's coal imports from Russia increased significantly in May, reaching 104,000 tons, compared to 2,470 tons in May last year. This shift in import patterns could indicate a potential new market for Russian coal exports.
In conclusion, the impact on Russian coal exports to China and on China's coal market in 2025 is largely due to demand shifts, sanctions, market dynamics, and energy policy transformations, not weather conditions or production interruptions. Understanding these factors is crucial for both Russian and Chinese coal industries as they navigate this changing landscape.
- The decline in Russia's coal exports to China in 2025 is not due to weather conditions or production losses, but rather economic, geopolitical, and policy-related factors.
- NEFT Research indicates that the price of Russian energy coal on the Asian market has dropped to a four-year low due to excess supply and reduced imports by key consumers.
- China's rebalancing towards cleaner energy sources and the persistent overcapacity in its domestic coal sector have led to weaker coal demand and a drop in Russian coal imports.
- Sanctions on Russia are threatening closures of many coal enterprises, further reducing Russia's ability to export coal to China.
- NEFT Research sees South Korea as a promising direction for future Russian coal exports, as high-calorie coal prices in South Korea have been rising due to high demand and new tenders.
- Poland's coal imports from Russia increased significantly in May, indicating a potential new market for Russian coal exports.
- Understanding the factors influencing Russian coal exports to China and China's coal market is crucial for both the Russian and Chinese coal industries as they negotiate this changing landscape, including data and cloud computing, personal finance, lifestyle, food and drink, travel, sports, technology, and business investing.
