China coking coal futures head for record 46% monthly surge
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Coking coal futures on China's Dalian exchange rose 6% on Monday, putting them on track for a record 46% monthly surge in August. The rally, driven by supply disruptions including a deadly May mine explosion, has squeezed margins for Indian steelmakers. India relies on imports for up to 95% of its coking coal demand.
Key Facts
- Coking coal futures on China's Dalian exchange were up 6% on Monday afternoon local time.
- The August monthly surge of 46% is the biggest since Dalian coking coal futures began trading in 2013.
- The previous record monthly jump was 38% in July 2025.
- India relies on imports for as much as 95% of its coking coal demand.
- Premium coking coal FOB Australia surged 25% in the first seven months of 2026 compared to last year.
Supply Disruptions
The price rally follows a deadly coal mine explosion in China's Shanxi province that killed more than 80 people in May. Increased safety checks on other Chinese mines have further constrained supply. BHP cited strong Indian import demand and supply disruptions as tightening the seaborne market. The slower ramp-up of new mines and supply disruptions at key producer Australia also contributed to higher prices.
Impact on India
Steelmakers in India, the world's second-largest steel producer after China, have seen margins squeezed by rising input costs. India imports up to 95% of its metallurgical coal needs. The price of premium coking coal FOB Australia rose 25% in the first seven months of 2026.
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