December 31, 2025 - As the year draws to a close, reflecting on the coal industry in 2025 reveals both impressive achievements and potential challenges. From January to November, China's industrial raw coal output from enterprises above designated size reached 4.4 billion tons, marking a 1.4% year-on-year increase. Annual raw coal supply is poised to hit another record high. Meanwhile, coal consumption experienced its first year-on-year decline in nearly nine years. Amidst a relaxed supply-demand landscape, coal's role is accelerating its transformation. Guided by the accelerated establishment of a production capacity reserve system and “anti-internalization” policies, coal enterprises in 2025 balanced supply assurance with transformation, and volume expansion with quality enhancement, propelling the industry into a new phase of transformative development.  

From January to November, stable production capacity was released across China's major coal-producing regions. Shanxi, Shaanxi, and Xinjiang saw raw coal output increase by 2.4%, 2.6%, and 2.6% year-on-year, respectively. Although Inner Mongolia's output contracted compared to last year, its annual production is still projected to exceed 1.2 billion tons. Guided by the “selective mining of rich deposits” policy, the “coal sea south of the Yangtze” also ramped up production, with Guizhou's raw coal output rising 6.3% year-on-year. A batch of mines in Heilongjiang resumed production after consolidation, resulting in an 18.5% year-on-year surge in output. Concurrently, some provinces advanced coal capacity reduction efforts. For instance, Jiangxi phased out two mines with a combined annual capacity of 700,000 tons, leading to a 37.6% year-on-year decline in the province's coal output.

Policy regulation emerged as a key factor influencing regional coal production. In July 2025, the National Energy Administration launched inspections targeting overcapacity production to ensure stable and orderly coal supply. This “anti-overcapacity” policy effectively standardized production practices in major coal-producing regions. Starting in July, national coal supply contracted year-on-year for five consecutive months, triggering a rebound in coal prices from their lows. Improved supply-demand dynamics also boosted profitability in the coal sector, with over 60% of listed companies reporting positive earnings in the third quarter.

Alongside countering overcapacity, the establishment of a production capacity reserve system progressed steadily in 2025, enhancing the resilience of coal supply. The 2026 National Energy Work Conference revealed that China will accelerate the construction of reserve capacity exceeding 90 million tons per year by 2025. The Implementation Opinions on Establishing a Coal Production Capacity Reserve System, jointly issued by the National Development and Reform Commission and the National Energy Administration, propose that by 2030, China will strive to establish approximately 300 million tons per year of dispatchable reserve capacity. This will significantly enhance the nation's coal supply security capabilities while continuously improving supply flexibility and resilience.

By 2025, modern coal chemical processing and coal-electricity integration models will mature further. Annual coal conversion capacity nationwide is projected to reach approximately 160 million tons of standard coal equivalent, solidifying coal chemical processing as an indispensable component of the petrochemical industry. The 2026 National Energy Work Conference concluded that energy security in 2025 was robust and effective, with supply safeguarding achieving the best results since the start of the 14th Five-Year Plan period. Coal production, supply, and pricing remained stable, effectively addressing 20 peak summer electricity load challenges that exceeded last year's peak demands.

From a longer-term industry transformation perspective, the intelligent and green development of the coal sector deepened further in 2025. According to statistics from the China National Coal Association, over 900 intelligent coal mines have been established nationwide, accounting for nearly one-quarter of all coal mines, with intelligent mining capacity historically exceeding 50% of total production. While solidifying the foundation for stable energy supply, the coal industry actively explored green transformation. In November, the National Energy Administration issued the “Guiding Opinions on Promoting the Integrated Development of Coal and New Energy,” proposing to accelerate the development and utilization of new energy resources in coal mining areas and promote the establishment of a new pattern of coordinated development between traditional and new energy. Green energy development and ecological restoration of mining areas are advancing simultaneously, enhancing the ecological beauty of mining regions.

However, coal market sentiment and the underlying supply-demand dynamics remain complex. It is now an industry consensus that total coal consumption has entered a peak plateau phase, with short-term supply-demand fluctuations and long-term demand decline recognized as prevailing trends. Yet, coal's role as a reliable backup energy source remains indispensable.

Looking ahead to 2026, the trend toward stabilization and improvement in coal supply and demand will persist. As the opening year of the 15th Five-Year Plan, policy measures to stabilize and revive the economy will gradually take effect, driving sustained growth in energy consumption demand. The center of coal production will further shift toward resource-rich western regions. Shanxi, Inner Mongolia, Shaanxi, and Xinjiang will remain the primary coal-producing areas nationwide. Meanwhile, ensuring resource continuity and achieving transformative development in older mining areas remains a challenge to be addressed. Additionally, accelerating the resource utilization of coal, ensuring efficient cross-regional transportation, and promoting technological innovation and industrial integration are issues that require resolution.

As we bid farewell to 2025 and move toward 2026, energy security and green transformation remain constant themes for the coal industry.