India’s coal imports to pick up in Q4 26 as stocks tighten

Firm consumption demand meets constrained domestic coal supply pushing India to ramp up thermal coal imports.

India will have to increase buying thermal coal from the seaborne market again from October 2026 as rising power demand and weaker domestic coal output puts increasing pressure on power plant inventories. 

India thermal coal imports (Mt)

Source: Kpler

Power demand is on track to increase for the rest of the year in line with India’s growing economic activity. This requires coal plants to run at higher load factors, leading to stockpiles falling faster than domestic mines can refill them. Monsoon has held back production into autumn, and a weak hydro season has increased the call for coal-fired generation over the summer. Given local supply is unable to close the gap, boosting imports remains the viable route to ensure supply security. 

Demand remains robust

India’s power generation is running well above seasonal levels and shows no sign of slowing, which is the main driver of growth in coal burn. Coal-fired generation should reach about 114 TWh in August 2026, up nearly 14% from a year earlier. Coal consumption should climb close to 10% year on year, rising to roughly 77 Mt in August from about 70 Mt a year ago. 

Demand is also expected stay firm into Q4 2026. Industrial output reaches its seasonal peak. As demand builds like this, coal plants have to run at high load factors. With solar fading in winter and hydro weak on a poor monsoon, coal alone must carry India’s base load.

India historical vs forecast coal-fired generation (TWh)

Source: CEA, Kpler Insight

Coal production trending lower

Coal production is on track to decline more than 8% year on year in August, easing to around 64 MT, before recovering in from October through Q4 2026.  

Total coal received at power plants barely move and are forecasted to be near 66Mt across both August and September against coal consumption demand of 77Mt and 68 Mt, respectively. 

Total coal stocks should decline by around 50% year on year in August, sliding to about 27 MT from roughly 53 MT a year earlier, without any noticeable improvement in stock levels until the end of the current financial year in April 2027. 

India utilities historical vs forecast coal inventories (Mt)

Source: CEA, Kpler Insight

This leaves utilities exposed to critical stock levels unless imports are reintroduced for blending. The recovery in domestic output from October should ease the pressure only temporarily, production typically comes under strain again once the next monsoon approaches, pointing to October 2026 as the likely point at which import buying resumes to rebuild the buffer.

India coal production (Mt)

Source: India ministry of coal