Japan is by far the world's largest importer of steam coal, mainly for power generation, paper pulp, and cement production. Japan also is the world's largest importer of coking coal for its steel industry. Sources of imported steam coal are Australia, South Africa, the United States, and China. Japanese coking coal imports come mainly from Australia, Canada, the United States and Russia. The main recent development in Japan's coal imports is the price cuts which were negotiated with firms from Japan's largest supplier, Australia.
Similar cuts apply to other Australian suppliers.
Japan maintains heavily subsidized domestic coal production, partly for energy security reasons and partly in order to support the development of coal technology. In March 1997, Japan's largest and oldest coal mine, the Miike coal mine on the main island of Kyushu, was closed after 124 years of operation. Coal mining subsidies are scheduled to be ended in fiscal year 2001. There is much debate within Japan concerning the country's future demand for coal. Regional and state-owned power companies estimate that coal demand will rise from 40.7 Mmst in 1997 to 74.8 Mmst in 2002 and 91.7 Mmt in 2007.