Guangzhou Development: The duration and extent of the increase in domestic thermal coal prices this year may be relatively limited

Guangzhou Development stated in response to questions from researchers that by 2025, the company’s total coal operating volume will reach 52.02 million tons, a year-on-year increase of 21%, of which 11.15 million tons will be imported coal.

It further mentioned that in 2026, domestic capacity will be the core pillar for supplying thermal coal, while imported thermal coal will play a supplementary role in adjusting and reallocating resources across regions.

Guangzhou Development expects that in 2026, the domestic supply side will further release capacity, combined with policy changes from major coal-exporting countries such as Indonesia and Australia, which will compress the demand for imported coal.

It indicated that considering factors such as shipping costs and exchange rate fluctuations, the price advantage of imported thermal coal has weakened. The company’s procurement volume of imported coal is expected to decline in 2026.

Regarding the price trend of thermal coal, Guangzhou Development stated that it anticipates the overall domestic supply of thermal coal will remain relatively loose in 2026, with social inventories expected to maintain a relatively high level, providing a strong market adjustment capability, while the demand for thermal coal is unlikely to see concentrated releases. Prices may experience a temporary rise during the peak demand season, but the overall duration and upward space may be relatively limited.

Guangzhou Development is one of the important comprehensive energy enterprises in Guangdong Province, mainly engaged in the investment, development, and operation of green low-carbon comprehensive smart energy, energy conservation, environmental protection, and energy finance, covering power, coal, natural gas, steam, and refined oil, while also providing unloading, transportation, and storage services for natural gas, coal, and oil products.

Specifically in terms of coal, Guangzhou Development’s wholly-owned subsidiary, Energy Logistics Group, is the largest vertically integrated coal operating enterprise in South China and is one of the influential coal suppliers in the country, with business coverage across 19 economically developed provinces and cities domestically and overseas, and it has been included in the first batch of national key coal supply trade enterprises.

Guangzhou Development mentioned during the research that the company has over 20 years of coal trading experience and has established a vertically integrated industrial chain covering resource development, transportation, transshipment, warehousing, and marketing, adjusting inventory in a timely manner according to coal market conditions. Approximately 60% of the downstream customers are power plant users, while the remainder includes chemical enterprises, factories, and traders.

It stated that the company has an integrated coal and power industry chain with scientifically coordinated inventory management. The coal consumption of the company’s coal-fired plants is about 3.7 million tons in 2025. The annual long-term coal contracts signed by power plants are generally stable.

In terms of electricity, Guangzhou Development introduced that the long-term electricity price in Guangdong for 2026 will be 0.372 yuan per kilowatt-hour, a year-on-year decrease of 0.02 yuan per kilowatt-hour, a reduction of about 5.1%.

It also stated that due to factors such as electricity prices and coal prices, the profitability of thermal power is expected to be under pressure in 2026, but thanks to the increase in capacity electricity prices effectively compensating for fixed costs, the expected decline will be limited.

Editor | Xu Heyang

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