Needle coke trend in the second half of the year

1. Similarities and differences between needle coke and petroleum coke.

1. Applications of needle coke in 2021: 55% is used to prepare anode materials, 45% is used to prepare graphite electrodes (mainly for steelmaking); Applications in 2022: 70% is used to prepare anode materials, 30% is used to prepare graphite electrodes; JUXING UHP graphite electrode preparing by imported needle coke is widely used for EAF/LF steelmaking. Applications of petroleum coke: 58% - 59% is used to prepare aluminum carbon, about 30% is used to prepare fuel agent, and about 10% is mainly used to prepare carburant agent, graphite electrode and lithium battery anode;

2. In some anode materials, some metal silicon and ordinary power electrodes, they have some substitution between each other;

3. The sources of needle coke are mainly petroleum and coal chemical industry; The raw material of petroleum coke is the residue left after crude oil refining, which is formed after coking. The sulfur content of petroleum coke depends on crude oil. Crude oil can be divided into high sulfur, medium sulfur and low sulfur; The sulfur content is related to the origin. Almost all crude oil in the Middle East and abroad is high sulfur crude oil, and Daqing and Liaohe oilfields are basically low sulfur crude oil. 

2. Needle coke shows obvious cost driving characteristics this year. From the beginning of the year to the present, the cumulative increase of oil price is almost 50%, which directly increases the cost of oil-based needle coke by nearly 6000 yuan. However, the increase range of needle coke price is not so large, that is, 3000 or 4000 yuan. The profit of needle coke is obviously diluted. We have recently communicated with some coking enterprises in Shandong. The profits of these leading enterprises are basically only about 10%, with a sharp decline in profits.

3. Compared with needle coke, petroleum coke has increased more this year. Needle coke average price in the first half of this year may rise by about 50% compared with the first half of last year, but petroleum coke price has almost doubled, and the increase is even greater. Recently, with the sharp decline of aluminum price and a large number of imported resources to the port, petroleum coke price has been corrected by nearly 2000 yuan, but low sulfur petroleum coke price is relatively strong. At present, the supply of low sulfur coke is relatively tight. Basically, the production of low sulfur coke has been reduced by almost 5%, because it is mainly used in anode industry, so the market resources are still relatively tight. At present, desulfurized coke is basically the main resource.

4. Prospect of needle coke market. From the perspective of the future market, we feel that the overall supply of needle coke is still relatively tight. On the one hand, the demand for anode materials has a rapid pulling effect. On the other hand, the expansion of needle coke production capacity is not as good as that in the early stage.In the early stage, there was an annual increase of 300,000 to 400,000 tons, and then it basically entered a relatively gentle growth period, so the overall supply was still relatively tight. And from this year, the new projects this year, including several projects in Shanxi, Shandong and Hebei, are basically all coal series, which are relatively restricted by environmental protection, the cost and capital pressure are relatively large and the competitiveness is weak. Therefore, it is not easy to predict how much capacity will be released in the future. Generally speaking, we think the supply of needle coke will be relatively tight.

5. For petroleum coke, the price trend is actually very similar to that of crude oil. In the second half of the year, the total amount of petroleum coke is general, but low sulfur coke is still tight, because several new projects in the second half of the year are basically high sulfur coke, so low sulfur coke will continue to be tense. The second half of the year, in the short term, petroleum coke and needle coke prices will be slightly adjusted, but in the long term, after the adjustment, the overall price is still in a high-level fluctuation, and a sharp decline is impossible. Relatively speaking, the fluctuation range of petroleum coke may be larger (but the low sulfur petroleum coke will be stronger), while the fluctuation range of needle coke will be smaller. Contact us to learn more about steel and iron industry.