The transformation of plant material into coal takes place in two stages, biochemical degradation and physico-chemical degradation. Biochemical degradation involves chemical decomposition of botanical matter aided by organisms. In tropical environments, this process may be rapid, because the warm moist conditions are ideal for the bacteria and fungi that are responsible for this process. However, plant growth is also more rapid so the increased rate of decomposition may be balanced by plant growth.
In tropical conditions high rates of evaporation need to be coupled with high precipitation to maintain plant growth and peat accumulation. In more temperate climates the growth rate of vegetation may be cyclical in nature and slower since the seasonal variation in conditions is greater. The environmental conditions are also less ideal for fungi and bacteria, therefore, their slower growth rate is matched by a slower rate of biochemical degradation. In both temperate and tropical climate zones, humification, the biochemical path from woody peat to the huminite macerals, affects the preservation of compounds in plant cell walls, which consist of cellulose, hemicellulose, and lignin. Of these, lignin is the most resistant compound. Humification begins with the oxidation of plant matter and attack by aerobic organisms such as fungi, insects and aerobic bacteria. As a result, hydrocarbon-rich functional groups are extracted and the organic material left behind is enriched in oxygen and carbon. Various acidic humic substances are formed during this process. If humification continues, the plant material will be completely degraded into carbon dioxide and water. When the plant material or degraded plant material is buried below the ground water table it is no longer subject to oxidation or attack from aerobic organisms, the microorganisms requiring oxygen to function. Anaerobic bacteria, functioning in the absence of oxygen, may still decompose the plant matter until it reaches a depth or conditions unsuitable for their viability. Biochemical degradation ends at the rank of subbituminous coal, when humic substances have polymerized.