European coal prices slip below $115/ton as Chinese demand cools

European benchmark retreats after a brief rally

Coal prices on the European market fell back below $115 per ton in the week to July 13, 2026, reversing the gains recorded a week earlier, according to a market snapshot published by finance.rambler.ru. The move puts the European benchmark back into the softer trend that has dominated the global coal trade through early summer.

The pressure is coming primarily from Asia. The cost of Russian thermal coal delivered to China fell by $5.3 per ton in the week to July 3, freight included, to $105 per ton, according to Neft Research data cited by Kommersant. As recently as mid-June, cargoes were selling at $115-117 per ton, meaning prices lost roughly 10 percent over two weeks.

Chinese stockpiles and rain weigh on demand

Analysts point to two linked drivers. Stockpiles at Chinese power stations have been rising, and prolonged rainfall across the country has cut into demand. The wet weather lowers overall electricity consumption while boosting output from hydroelectric plants, so thermal generators burn less coal. As a result, some power stations have already secured enough coal to cover the entire summer.

Alexander Kotov, consulting partner at Neft Research, said that if the cool, rainy conditions across Asia persist, a rebound in quotations could not be expected before September or October. He added that the renewed conflict in the Middle East could influence prices, but only if oil and liquefied natural gas (LNG) shipments were to halt.

How much further can prices fall

Current levels are already close to the floor for producers. Nariman Taiketaev, director of the corporate ratings group at agency NKR, said prices have approached minimally profitable levels, with room for a further decline of only $10-15 per ton. That leaves limited downside before output becomes unprofitable for higher-cost suppliers.

South Korea becomes the premium outlet

For Russian suppliers, redirecting volumes to South Korea offers a way out, according to Kotov. South Korea has turned into a premium market because of the discounts of around 10 percent that persist on cargoes sold into China. Diverting coal toward Korean buyers allows exporters to capture better netbacks than the discounted Chinese trade currently provides.

Coking coal leads the decline

The weakness is not confined to thermal grades. In the last week of June, the price of coking coal at Far East ports fell by 6.2 percent, or $10, the sharpest weekly drop since the start of the year. The parallel slide in both thermal and metallurgical coal underscores how broad the current softness in the seaborne market has become.

For importers, the combination of ample Chinese inventories, strong hydropower output and near-floor pricing points to a stable, buyer-friendly market through the summer months. For exporters, the near-term question is whether alternative destinations such as South Korea can absorb enough volume to offset thin margins on Chinese sales, and whether any escalation in the Middle East disrupts competing oil and LNG flows enough to lift coal.