China, the world's leading coal purchaser, reduced its coal imports by 18% in May compared to the same period last year, according to customs data released on Friday. This decline reflects the growing use of cost-competitive domestic coal and an increase in renewable energy sources, which have reduced reliance on coal-fired power generation.

A drone view shows piles of coal sitting next to cranes at a port in Lianyungang, Jiangsu province, China February 16, 2025.

In May, China imported 36.04 million metric tons of coal, a decrease from 43.82 million metric tons in May 2024, as reported by the General Administration of Customs. This marks the third consecutive month of year-on-year declines in coal imports, following consistent increases since November 2022, except for January and February, when the Lunar New Year holiday affects comparisons.

From January to May this year, total coal imports reached 188.7 million metric tons, an 8% drop from 204.9 million tons during the same period last year. The shift is attributed to competitive domestic coal prices, which have remained at their lowest levels in four years, impacting the profitability of imported coal.

The Bohai-Rim Bay thermal coal price index indicated that medium-grade coal, with a heat value of 5,500 kilocalories per kilogram, averaged 632 yuan ($87.91) in May. Meanwhile, domestic coal production rose by 7% to 1.58 billion tons during the first four months of the year, further supporting the trend toward local supply.

China's thermal power generation, primarily from coal with a minor contribution from natural gas, decreased by 4% from January to April. During the same period, renewable energy sources met the 3% rise in power demand, highlighting a shift toward cleaner energy alternatives.