Zhengzhou ChangHeYue New Material CO.,LTd
China’s Petroleum Coke Market: Recent Price Plunge & Global Supply-Demand Dynamics
Market Snapshot: Sharp Price Correction in Two Weeks
Over the past two weeks, China’s petroleum coke market has witnessed a dramatic price decline, with spot prices dropping by more than 10%—the steepest fall since 2020. This sudden downturn, triggered by supply-demand imbalances, has ripple effects across refining, aluminum, steel, and renewable energy sectors.
Supply Overload: Domestic Production & Global Imports
- Refining Capacity Expansion
- Chinese refineries have ramped up operations to meet robust demand for gasoline and diesel, boosting petroleum coke output as a byproduct.
- Major producers like Sinopec and CNOOC are maintaining high crude processing rates, directly increasing domestic supply.
- Surge in Middle Eastern Imports
- Oil-rich nations (e.g., Saudi Arabia, Iran) are exporting record volumes to China, citing excess inventory and limited domestic demand.
- Imported petroleum coke, priced 80–100 USD/tonne lower than domestic products, has flooded markets, worsening oversupply.
Demand Erosion: Traditional Sectors & New Energy Disruption
| Key Sector | Impact | Drivers Behind Decline |
|---|---|---|
| Aluminum Anodes | Demand down 15–20% | Weak aluminum demand, factory closures |
| Steel Industry | Reduced use as carbon additive by ~30% | Capacity cuts, environmental regulations |
| New Energy | Emerging substitutes threaten market share | Lithium-ion battery tech advancements (e.g., solid-state electrolytes) |
Critical Shifts:
- Silicon-based anodes for batteries are reducing reliance on petroleum coke-based carbon materials.
- Solar/wind energy adoption curbs traditional carbon applications in power generation.
Short-Term Outlook: Prolonged Oversupply
- Supply: Refineries are unlikely to cut production amid high crude demand; imports from the Middle East will remain elevated.
- Demand: Aluminum and steel sectors show no immediate recovery signs. New energy alternatives continue to gain traction.
- Price Trend: Experts expect prices to stay low, with some estimating a further 5–8% drop in Q4.
Long-Term Transformation: Adaptation & Innovation
- High-Value Applications
- Developing premium carbon materials for semiconductors, aerospace, and hydrogen fuel cells.
- Pilot projects for carbon fiber production from petroleum coke could unlock new revenue streams.
- Global Supply Collaboration
- Negotiating long-term contracts with Middle Eastern producers to stabilize pricing.
- Investing in carbon capture technologies to align with China’s carbon neutrality goals.
- Policy-Driven Adjustments
- Government incentives for cleaner refining processes and circular economy models.
- Industry-led standards to differentiate high-quality petroleum coke from low-grade imports.
Conclusion: Crisis as a Catalyst for Change
The current market turmoil underscores the urgency for China’s petroleum coke industry to pivot from volume-driven growth to value innovation. While short-term challenges persist, strategic investments in advanced materials and sustainable practices could position China as a leader in the global carbon-based materials market post-2030.
Key Takeaways:
- Supply vs. Demand: Record domestic output + aggressive Middle Eastern imports = structural oversupply.
- Industry Transformation: Traditional sectors (aluminum, steel) shrink; new energy and high-tech applications emerge.
- Global Strategy: Collaboration, R&D, and policy alignment critical to navigating the transition.
