The Great Plateau: Is the Age of Coal Finally Running Out of Steam?

Wazzup Pilipinas!? 

For over a century, coal has been the unshakeable bedrock of industrial growth. However, a tectonic shift is underway. A twenty-year analysis of global energy data reveals that the era of unbridled expansion is over. We are no longer witnessing a temporary pause, but a structural "major slowdown," with the growth rate of global coal demand plummeting by 50% in this decade compared to the last.

The industry is flashing warning signs: from the blast furnaces of China to global trade routes, the data suggests the King of Commodities has hit a ceiling.

A Tale of Two Decades: The Gold Rush vs. The Stagnation

To understand the magnitude of this collapse, we must view the timeline in two distinct chapters. The period between 2005 and 2014 was a gold rush, characterized by a steep climb where global coal demand surged by nearly 2 billion tonnes. During this era, the Compound Annual Growth Rate (CAGR) stood at a robust 2.81%.

Then came the turning point.

The subsequent decade, 2015 to 2024, has been defined by stagnation and volatility. The CAGR crashed to just 1.31%—a decline of over 53% between the two periods. Demand growth struggled, adding only about 1 billion tonnes, half of the previous decade's volume. If we account for the intense volatility of the market—which saw demand decline seven times in the last 20 years—the effective reduction in average annual growth is closer to a staggering 70%.

The China Syndrome: A Giant Pivots

The driver of this deceleration is undeniable: China. As the consumer of nearly half the world’s coal, China is the gravitational center of the market; when it shifts, the world shakes.

We are witnessing a structural change rooted in Beijing's aggressive energy transition. The days of infrastructure-heavy economic growth are fading, replaced by a pivot toward low-carbon technology. The results are stark:

The Renewable Explosion: China’s wind and solar share has doubled since 2020, now accounting for 18% of electricity generation.

Displacing Demand: In the first half of 2025 alone, clean power covered all new demand growth, actually forcing fossil generation to drop by 2%.

Thermal Decline: Thermal power generation in China is currently falling, signaling that thermal coal demand will likely remain flat or decline through 2025.

Steel’s Iron Grip Loosens

Perhaps the most dramatic signal comes from metallurgical (coking) coal, the critical ingredient for steel production. For years, this sector seemed immune to the pressures facing thermal coal. That immunity has ended.

Global demand for metallurgical coal has flattened, indicating the commodity has likely already reached its peak. This is a "structural decline" expected to continue through 2030. The culprit, again, is a transforming industrial landscape:

Approvals Halted: In 2024, approvals for new metallurgical coal-based blast furnaces in China’s heavy industry came to a halt.

Technology Shift: The industry is pivoting toward electric arc furnaces, effectively ending the growth era for Chinese metallurgical coal demand.

Global Ripple: With 85% of global metallurgical coal used for steel, and China producing 53% of that steel, this pivot sets the trend for a global plateau or rapid decline.

The Investor’s Warning

The International Energy Agency (IEA) has flagged a decline in global coal trade for the first time since the pandemic. If this decline continues into 2026, the IEA terms the event "unprecedented".

The message for the financial world is sharp and urgent: these are not temporary fluctuations. We are seeing a structural change where the demand curve has flattened and a peak is "around the corner". With rapid renewable adoption in China showing signs of flattening global demand, the window for traditional coal investments is closing. This serves as a clear indication for investors to fundamentally rethink their coal mine investment plans.

Summary of the Structural Shift

Growth Collapse: Global coal demand growth rate has dropped by over 50% between the 2005-2014 and 2015-2024 periods.

Metallurgical Peak: Demand for steel-making coal has flattened and is set to decline as China halts new blast furnace approvals.

Renewable Takeover: China’s massive uptake in solar and wind is now covering demand growth, actively displacing fossil fuel generation.

Future Outlook: Current trends suggest global coal demand will plateau and possibly begin a structural decline by 2030.