Fitch Solutions’ BMI Country Risk and Industry Research unit has raised its 2026 coking coal price forecast to $190/mt, up from a previous estimate of $180/mt, citing expectations of sustained import demand from India and China, according to media reports.
China’s production decline supports seaborne prices
While BMI maintains a cautious stance on China’s steel sector, with crude steel output projected to fall by four percent to 935 million mt in 2026, it expects a much sharper contraction in domestic coking coal supply.
China’s coking coal production is forecast to decline by eight percent to 454 million mt in 2026, a drop that is expected to provide underlying support to seaborne prices. However, BMI warned that upside potential may be capped by strong exports from land-based suppliers such as Mongolia and Russia.
India drives import growth amid domestic shortfall
In India, BMI highlighted robust steel output growth alongside weakening domestic coking coal supply. According to data from the World Steel Association, India’s crude steel production rose by 10 percent year on year to 136 million mt in the January-October 2025 period.
Over the same period, India’s coking coal production fell by 10 percent to 26.8 million mt, with output at Bharat Coking Coal declining 17 percent to 17.6 million mt.
To compensate for this gap, India increased imports sharply. BMI estimates that coking coal imports rose by 8.6 percent year on year to 50 million mt in the January-October 2025 period.
Long-term outlook unchanged despite near-term upgrade
Despite the upward revision for 2026, BMI has left its longer-term price assumptions unchanged, forecasting average coking coal prices of $184/mt in 2028 and $180/mt in 2029.
These projections reflect expectations that India’s rapidly expanding steelmaking capacity will structurally increase import demand. Over the 2025-2034 period, BMI expects India to overtake China as the world’s largest importer of coking coal.
India’s Mission Coking Coal faces structural constraints
BMI noted that, since the launch of India’s “Mission Coking Coal” initiative in August 2021, which aims to raise domestic output to 140 million mt by 2030, production has increased steadily. However, the agency cautioned that sustaining this growth will be challenging, as most of India’s coal reserves are low-grade and unsuitable for steelmaking.
As a result, India is expected to remain heavily dependent on seaborne supplies. India’s steel secretary has indicated that coking coal imports could rise to 160 million mt by 2030, compared with around 58 million mt currently.
Upside and downside risks to price forecast
BMI identified both downside and upside risks to its outlook. On the downside, a sharp economic slowdown in developed markets could weaken manufacturing, construction and steel demand, weighing on coking coal consumption and prices, particularly if supply growth leads to inventory accumulation.
On the upside, a rebound in China’s construction sector and stronger steel output could significantly boost demand for Australian coking coal, potentially triggering a sharp price rally.