Soaring temperatures have driven national power loads to repeatedly hit record highs, while the newly unveiled 15th Five-Year Plan for the coal industry signals that consumption will peak, with supply concentrating toward five major production bases. This structural shift, combined with strong high-season demand, is lending solid support to elevated coal prices. Founder Securities notes that coking coal prices are showing notable resilience, with premium primary coking coal producers standing to benefit from sustained high prices underpinned by rigid supply constraints.
Data shows that national temperatures have continued to climb this month, with the country's power load reaching 1.557 billion kilowatts on August 7—the fourth record high this year and 49 million kilowatts above last year's peak. Extreme heat is the primary driver. The China Electricity Council forecasts that the national maximum regulated load will average 1.6 billion kilowatts in 2026, up roughly 6.1% year-on-year. Under sustained heat, end-user coal consumption remains at seasonally elevated levels, with daily consumption at power plants in eight coastal provinces and seventeen inland provinces posting positive year-on-year growth, keeping thermal coal demand well-supported.
Thermal coal prices have continued their upward trajectory this week, with the Qinhuangdao Port Q5500 spot price rising 1.3% week-on-week to 860 yuan per tonne. Mine-mouth prices have also been adjusted higher, reflecting a simultaneous increase in both volume and price. The demand impact is also spreading to imported coal, driving parallel price increases. Between August 10 and 16, imported primary coking coal from Russia, Canada, and Australia at Jingtang Port rose 60-70 yuan per tonne week-on-week and 130-330 yuan per tonne year-on-year. Mongolian coking raw coal and washed coal at the Ganqimaodu border port increased 100-175 yuan per tonne week-on-week and 255-295 yuan per tonne year-on-year.
In the near term, high temperatures are expected to persist through late August, keeping daily coal consumption at coastal power plants elevated and further depleting inventories across the supply chain. From September onward, seasonal demand may soften, but restocking demand is likely to gradually emerge, providing support for coal prices to remain at high levels.
On the supply side, structural tailwinds are emerging. The release of the 15th Five-Year Plan for the Coal Industry sets targets for 2030, including a higher share of high-quality advanced production capacity and a greater proportion of intelligent mines, alongside a peak in coal consumption. This reinforces medium- and long-term supply constraints and a high-quality development orientation. Debon Securities highlights that the Plan elevates coal's strategic role in energy security, promotes larger-scale, more advanced capacity, and applies AI to mine construction—measures expected to stabilise the industry's supply structure, smooth cyclical fluctuations, and bolster companies' capacity for steady dividend payouts.
Meanwhile, national safety production supervision remains stringent, with coal mine safety inspections continuing at high intensity. Month-end production suspensions continue to constrain output. Last week, production halts in Shanxi reached 55.9 million tonnes, and key producing regions in Shaanxi and Inner Mongolia are also undergoing concentrated rectification, keeping capacity utilisation rates at low levels. Tight supply, coupled with high coastal daily consumption driven by heat, has led inventories across all segments to decline further. Stockpiles at Bohai Rim ports and coastal power plants continue to draw down, and the rapid inventory depletion has become a key factor pushing coal prices higher, keeping the market in a persistently tight balance.
Guotai Haitong notes in a research report that the coal sector's focus is shifting toward supply quality and resilient security of supply. On the demand side, the policy framework defines coal consumption peaking with a soft landing on a high plateau, ruling out abrupt reductions, thereby ensuring demand fundamentals remain resilient. This is positive for coal prices remaining in the upper half of a reasonable range over the medium to long term, while profitability visibility for coal companies improves.
Zheshang Securities points out that, considering current sector capital flows and fundamentals, it maintains a positive medium- to long-term outlook for coal valuation recovery. After an adequate clearing of pessimistic positioning, the three major concerns—overcapacity, high-carbon impairments, and safety incidents—have all been mitigated by policy measures. Downside risk for the sector is limited, and multiple catalysts provide a foundation for sustained upward movement.
Among related concept stocks, CHINA SHENHUA (01088) projects attributable net profit of 26.3 billion to 29.8 billion yuan for the first half of 2026, representing year-on-year growth of 6.9% to 21.1%. The expected performance change is primarily driven by increased coal chemical volumes and higher activity across its proprietary railway, port, and shipping operations, which have boosted related business profits year-on-year.
YANKUANG ENERGY (01171) expects attributable net profit of approximately 7.2 billion yuan for the first half of 2026, an increase of about 2.5 billion yuan or 53% compared to the same period last year. It also forecasts non-recurring items-excluded attributable net profit of approximately 4.5 billion yuan, up about 100 million yuan or 2% year-on-year.
CHINA COAL (01898) operates across coal production and trading, coal chemicals, coal mining equipment manufacturing, mine-mouth power generation, finance, and related services. Its main products include thermal coal, coking coal, polyolefins, urea, and methanol. The company holds a prominent scale advantage in its core coal business, with industry-leading technologies in mining, washing, and blending, and its production costs are lower than those of most coal enterprises nationwide.