According to the report released by Guosheng Securities, based on data from the National Bureau of Statistics, in August, the output of raw coal in large-scale industrial enterprises was 390 million tons, a year-on-year decrease of 3.2%, with the decline narrowing by 0.6 percentage points compared to July; China imported 42.737 million tons of coal, a decrease of 3.107 million tons compared to 45.844 million tons in the same period last year, down 6.8% year-on-year. Since the beginning of 2021, the downstream inventory of coking coal has been continuously depleted, and it is currently in the process of inventory reconstruction. The scale of terminal replenishment, channel stocking, speculative hoarding, and spot demand is large and will continue for a long time, not ending due to intensified market fluctuations. The actual demand for coking coal still shows strong resilience. Future focus should be on domestic supply, the recovery of Mongolian coal imports, and further measures to &#34;counter involution.&#34;
<h2>Guosheng Securities' main points are as follows:</h2>
August raw coal production declines for two consecutive months year-on-year
According to data from the National Bureau of Statistics, in August, the output of raw coal in large-scale industrial enterprises was 390 million tons, a year-on-year decrease of 3.2%, with the decline narrowing by 0.6 percentage points compared to July; the average daily output was 12.6 million tons. From January to August, the output of raw coal in large-scale industrial enterprises was 3.17 billion tons, a year-on-year increase of 2.8%. Looking ahead to 2025, without considering the impact of &#34;counter involution&#34; on production, and based on the analysis of coal mine capacity releases in 2025, it is expected that the annual output of thermal coal will continue to grow, reaching around 3.88 billion tons, but the growth rate will further narrow to about 1.4%.
August coal imports increase month-on-month but decrease year-on-year
In August 2025, China imported 42.737 million tons of coal, a decrease of 3.107 million tons compared to 45.844 million tons in the same period last year, down 6.8% year-on-year; an increase of 7.128 million tons compared to 35.609 million tons in July, up 20.0% year-on-year. From January to August 2025, China imported a total of 299.937 million tons of coal, a year-on-year decrease of 12.2%. According to forecasts from Platts and others, it is expected that the annual import level of thermal coal may drop to around 38 million tons, a year-on-year decline of 6.4%.
August thermal power generation increases by 1.7% year-on-year
In August, the power generation of large-scale industrial enterprises was 936.3 billion kilowatt-hours, a year-on-year increase of 1.6%; the average daily power generation was 30.2 billion kilowatt-hours. From January to August, the power generation of large-scale industrial enterprises was 6.4193 trillion kilowatt-hours, a year-on-year increase of 1.5%. After adjusting for the number of days, the average daily power generation increased by 1.9% year-on-year. By type, in August, the growth rates of thermal power, wind power, and solar power generation in large-scale industrial enterprises accelerated, while hydropower saw an expanded decline, and nuclear power growth slowed. Among them, the thermal power generation in large-scale industrial enterprises increased by 1.7% year-on-year, with the growth rate slowing by 2.6 percentage points compared to July; hydropower generation decreased by 10.1%, with the decline expanding by 0.3 percentage points compared to July; nuclear power generation increased by 5.9%, with the growth rate slowing by 2.4 percentage points compared to July; wind power generation increased by 20.2%, with the growth rate accelerating by 14.7 percentage points compared to July; solar power generation increased by 15.9%, with the growth rate slowing by 12.8 percentage points compared to July.
August crude steel production year-on-year -0.7%
According to data from the National Bureau of Statistics, in August 2025, crude steel production was 77.37 million tons, down 0.7% year-on-year, with the decline narrowing by 3.25 percentage points compared to July. As of the week of September 12, 2025, the average daily pig iron output of 247 sample steel mills was 2.4055 million tons, a year-on-year increase of 7.69%
Supply Constraints vs. Slightly Pressured Demand, Short-term Likely to Be Dominated by Wide Fluctuations
The demand for inventory reconstruction has not yet ended. Since the beginning of 2021, the downstream inventory of coking coal has been continuously depleted, and it is currently in the process of inventory reconstruction. The scale of terminal replenishment, channel stocking, speculative hoarding, and spot demand is substantial and will continue for a long time, not ending due to intensified market fluctuations. The actual demand for coking coal still shows strong resilience.
Domestic supply disturbances still exist. On one hand, this week, coal mines in the Linfen and Lüliang regions of Shanxi are still experiencing production cuts due to factors such as changing working faces; on the other hand, to implement the cost reduction and efficiency enhancement tasks assigned by the group company, and as it is currently in the period of energy bureau verification of overproduction, some subsidiaries are implementing reduced production for certain long-term loss-making mines, executing the &#34;276 working days&#34; production plan, and there are still expectations of tightening supply in the Shanxi region.
Future focus on domestic supply, recovery of Mongolian coal imports, and further measures to &#34;counter involution&#34;: Whether domestic coal mines will see a decline in production due to overproduction verification; whether there will be significant disturbances in coking coal imports (especially Mongolian coal imports); and whether there will be strong stimulus policies implemented domestically.
Investment Strategy: Reiterate &#34;Coal prices may close at the highest point by year-end&#34;
Looking back at the coal market performance and price trends from the beginning of the year to now, the price reversal after the release of extremely pessimistic expectations. In mid-June, coal prices fell to 618 yuan/ton (the lowest point of the year) → subsequently began a seasonal rebound during the peak season → market expectations that the rebound would end after the peak season and still break the previous low → on July 22, the &#34;Document No. 108&#34; circulated → market enthusiasm was ignited, coal prices surged, and market expectations reversed → coal price bottom established, difficult to break previous low → market highly skeptical of price increases, expectations of limited verification of overproduction → some coal mines trialed the &#34;276 working days&#34; system → the impact of &#34;Document No. 108&#34; gradually manifested.
Regarding future coal prices, they may close at the highest price by year-end. Verification intensity exceeds market expectations (under the background of counter-involution, overcorrection or special black swan events impact) → demand resilience gradually manifests → prices fluctuate in the off-season or slightly adjust before rising again → year-end capacity increase disturbs market expectations → price increases exceed expectations, and may close at the highest point by year-end.
On the subject side
Recommend companies with high performance elasticity such as Lu'an EED (601699.SH), Yanzhou Coal Mining (600188.SH, 01171), and Jinkong Coal Industry (601001.SH). Focus on companies deeply engaged in smart mining such as Keda Control (831832.BJ). Pay close attention to central state-owned enterprises in coal such as China Coal Energy (601898.SH, 01898) and China Shenhua (601088.SH, 01088). Strongly recommend companies reversing from difficulties such as China Qinfa (00866); &#34;good performance leads to good stocks,&#34; with strong performers like Shaanxi Coal and Chemical Industry (601225.SH), DianTou Energy (002128.SZ), Huaibei Mining (600985.SH), and XINJI ENERGY (601918.SH).
Elastic Yanzhou Coal Mining, Jinkong Coal Industry, Pingmei Shenma (601666.SH), future incremental Huayang Co., Ltd. (600348.SH), Gansu Energy Chemical (000552.SZ), and suggest paying attention to elastic stocks such as Haohua Energy (601101.SH)
In addition, Anyuan Coal Industry (600397.SH), which has completed the change of controlling shareholder in the early stage and is currently undergoing asset replacement, is also worth paying close attention to.
Risk Warning
The production schedule of the under-construction mines exceeds expectations, downstream demand is below expectations, safety inspection efforts are below expectations, and there are risks in statistical data

601225

601898

01898

601699

601918

601088

CSUAY

01088

Guosheng Securities released a research report indicating that coal imports and raw coal production in August declined year-on-year, decreasing by 6.8% and 3.2%, respectively. Although there was a month-on-month increase, the overall trend shows that coal supply is still under pressure. It is expected that coal prices will reach their peak by the end of the year, and future attention should be paid to the recovery of domestic supply and Mongolian coal imports. The production of thermal coal is expected to continue to grow in 2025, but the growth rate will slow down

Zhitong

SHCI

China Coal Energy

CHINA COAL

Lu′an EED

XINJI ENERGY

CSEC/China Shenhua

China Shenhua Energy

CHINA SHENHUA

Guosheng Securities: In August, coal imports and production continued to decline year-on-year, reiterating that "coal prices may close at the highest point by the end of the year."