Global coal demand growth rate slows down as China shifts to renewable energy: Report

The report found that China is reshaping the global coal markets with low-carbon steelmaking and power generation 

A new report revealed that the global coal demand growth halved between the two 10-year periods, 2005-2014 and 2015-2024. The International Energy Agency’s Coal Market Report highlighted that this decline can be attributed to China’s shift to clean energy. 

The report found that coal demand is expected to rise by 0.5% in 2025, reaching a record 8.85 billion tonnes. Coal has been structurally declining since the past two decades in the European Union (EU) and the United States (US). According to the report, China has been central to both upward trends seen between 2005 – 2014, and downward trends seen between 2015-2024.The recent energy expansion in the country has flattened coal-fired power generation growth, the report stated. Continued renewables deployment at current levels would likely push global coal demand into decline, the report found.

Global Metallurgical Demand plateau

The report stated global metallurgical coal demand also seems to have flattened, indicating that it has reached a plateau and a peak is around the corner, if not already peaked. Structural decline is also evident with coal declining until at least 2030, according to the report. Metallurgical coal is said to have stronger aspects because of India’s reliance on imports to support its growing steel industry.

According to the report, a shift toward low-carbon steelmaking and a halt in new blast furnace construction in China suggest demand has reached a plateau. With China accounting for nearly 50% of global thermal and met coal consumption, the implications for exporters—including Australia, Mongolia, Russia, Indonesia, Canada, and the US—are significant.

“China’s coal-fired power generation has been falling for more than 18 months, and crude steel production for more than four years. This is the longest decline in record in steel production, said Lauri Myllyvirta, Lead Analyst, Centre for Research on Energy and Clean Air (CREA). “It’s also the first time that demand for coal-fired power is falling even as power demand grows rapidly,”

India’s coal demand to rise by 3% per year on average

India also saw a decline in the annual coal power generation for the third time in the past five decades. The report attributed the decline to an early and intense monsoon season. The largest absolute increase in coal consumption to 2030 is expected to take place in India, where demand is set to rise by 3% per year on average, leading to an overall increase of over 200 million tonnes. 

Global imports of coal also reached an all-time high in 2024, even as major importers such as Japan, Korea, Chinese Taipei and EU countries continued to reduce the volumes they brought in. Declines in those markets were more than offset by robust growth in China and, to a lesser extent, India. However, China and India’s coal imports declined in 2025 amid sluggish demand, sufficient domestic production and abundant stocks, said the report. 

Coal output set to decline by 2030 

The report predicted a decline in coal output across most major producer countries through 2030. This is due to a sluggish demand outlook, plentiful stocks and lower prices squeezing profit margins.  China’s domestic demand is decreasing while Indonesia faces weaker trade, according to the report. India seems likely to be an exception, with coal production rising as the government aims to reduce its reliance on imports, the report found. 

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