【Petroleum Coke】Domestic and Imported Supply Expected to Decline in Q3

Calcined petroleum coke, with its high carbon content, low sulfur, and low impurities, plays a vital role in modern manufacturing, especially in the aluminum and steel industries.

【Petroleum Coke】Domestic and Imported Supply Expected to Decline in Q3

In the second quarter, affected by special factors, local refineries maintained high operating rates. In the third quarter, refinery maintenance is expected to gradually increase, and operating rates are likely to decline accordingly. Domestic petroleum coke supply is expected to enter a downward phase, while imports are also projected to decrease due to multiple influencing factors. Demand from carbon materials and anode materials continues to provide stable support for the petroleum coke market. Under stable demand conditions, market attention should focus on how supply-side changes impact the petroleum coke market.

Figure 1 Shandong Independent Refineries Petroleum Coke Average Price Trend

Source: Sublime China Information

In April, the domestic petroleum coke market showed a trend of "structural divergence and narrow-range fluctuation": low-sulfur coke remained firm, while medium- and high-sulfur coke weakened slightly. State-owned refineries mainly maintained firm pricing, while Shandong independent refineries first weakened and later rebounded slightly. Overall monthly prices fluctuated within a narrow range and remained generally stable.

Supply Side: Transitioning from Loose to Tight, Low-Sulfur Tightness and Medium-High Sulfur Oversupply
Domestic supply saw increased maintenance at major refineries and declining operating rates. Low-sulfur coke remained in tight balance with low inventories. Maintenance expectations for Shandong independent refineries increased, reducing output, while inventories of medium- and high-sulfur coke accumulated and shipments slowed. On the import side, arrivals of Middle Eastern cargoes slowed, and port inventories continued to decline. Due to disturbances surrounding the Strait of Hormuz, expectations for tighter future imports strengthened, supporting market fundamentals.

Demand Side: Significant Divergence, Strong Low-Sulfur Demand and Weak Medium-High Sulfur Demand
Rigid demand from anode material producers remained strong with solid price acceptance. Prebaked anode restocking was active, with stable transactions and good premiums. Aluminum smelters maintained high operating rates but faced cost pressure, purchasing mainly on demand. Calcined coke, industrial silicon, and glass sectors resisted high prices and mainly purchased based on immediate needs. Toward month-end, there was limited pre-holiday restocking ahead of the May Day holiday, but the intensity was insufficient to reverse the weak market trend.

Market Sentiment: Cautious Game, Optimistic for Low-Sulfur and Bearish for Medium-High Sulfur
In the low-sulfur market, refineries maintained firm offers and controlled sales volumes with relatively confident sentiment, though buyers remained cautious about chasing higher prices. In the medium- and high-sulfur market, sentiment weakened with cautious bearish expectations. Prices remained stable at the beginning of the month, while concessions appeared at month-end to stimulate sales. Affected by crude oil fluctuations, geopolitical issues involving the U.S. and Iran, and month-end capital pressure, downstream buyers and traders mainly maintained light inventories and fast transactions, with a strong wait-and-see attitude.

In April 2026, the average petroleum coke price of Shandong independent refineries was RMB 2,653.3/ton, down RMB 261.44/ton month-on-month, a decrease of 8.97%. As of April 30, 2026, the average petroleum coke price of Shandong independent refineries was RMB 2,599/ton, down RMB 124/ton compared with March 31, 2025, a decline of 4.55%.

Figure 2 Comparison of Monthly Petroleum Coke Production of Shandong Independent Refineries

Source: Sublime China Information

In April 2026, petroleum coke production of Shandong independent refineries was 680,800 tons, down 3.53% month-on-month and up 30.9% year-on-year. The month-on-month decline was mainly due to maintenance shutdowns at some refineries. From January to April 2026, cumulative petroleum coke production of Shandong independent refineries reached 2.7714 million tons, an increase of 491,800 tons year-on-year, up 21.57%.

Petroleum coke production refers to the total output produced by refinery delayed coking units. Sublime China Information monitors petroleum coke production data from over 30 petroleum coke producers in Shandong Province, representing 90% of the province's total capacity. Petroleum coke production data is updated monthly.

Figure 3 Comparison of National Petroleum Coke Production from 2022 to 2026

Source: Sublime China Information

In April 2026, national petroleum coke production reached 2.3782 million tons, down 7.28% month-on-month and up 6.69% year-on-year. The month-on-month decline was mainly due to increased maintenance shutdowns at state-owned refineries. From January to April, cumulative domestic petroleum coke production totaled 9.8876 million tons, up 2.56% year-on-year.

Major Refineries: In May, Yumen Petrochemical and Yangzi Petrochemical were expected to begin maintenance at the start of the month, further reducing the average operating rate of major refineries. However, as maintenance at Tahe Petrochemical's No.2 CDU/VDU unit, Shijiazhuang Refining & Chemical, and Zhongjie Petrochemical gradually concludes, the average operating rate of major refineries may recover after mid-month. Currently, refined oil yields at major refineries remain at relatively high levels, so petroleum coke production is expected to remain generally stable in May.

Independent Refineries: In the short term, no refinery maintenance plans have been announced, but crude oil feedstock costs remain high and refining margins continue to weaken. Some refineries may reduce operating rates accordingly. Overall, the operating rate of Shandong independent refineries is expected to decline, while gasoline and diesel supply should remain sufficient.

Regarding domestic petroleum coke supply, Qingyishan, Haiyou, Huifeng, Zhonghaiwai, and Youtai refineries remain under long-term shutdown status. In the next phase, Tianhong, United, Wantong, Changyi, and Xintai plan maintenance shutdowns, while Huaxiang plans to resume operations. Overall operating rates at both major and independent refineries are expected to decline. On the import side, petroleum coke imports in May and June are expected to show a downward trend.

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