【Carburant】Persistent weak demand, how does the carburant market operate?

Cost aspect: As of the time of writing, the average market price of low-sulfur coke 1# is 3,425 RMB/ton, a decrease of 645 RMB/ton or 15.84% compared to the previous period; 2# coke is 2,683 RMB/ton, a decrease of 20 RMB/ton or 0.73% compared to the previous period. Recently, China's petroleum coke prices have continued to decline, and traders and downstream buyers are cautious in entering the market, with no obvious support for market prices. Downstream and end-users continue to reduce inventory, and downstream enterprises have experienced varying degrees of production cuts, weighing on petroleum coke prices.

Price aspect: The low-sulfur calcined coke carburant market is quoted at 5,500-6,000 RMB/ton, a decrease of 500 RMB/ton or 8.33% compared to the previous price; the graphitized carburant market is quoted at 6,000-6,300 RMB/ton. With the wide-ranging adjustment of low-sulfur coke market prices, the price of calcined coke carburants has declined; the supply of graphitized carburants has decreased, but downstream demand remains weak, and with a narrow rebound in raw material prices, the market price is temporarily stable. 

Downstream demand aspect: From a data perspective, the national independent electric arc furnace operating rate and capacity utilization rate have slightly declined. The main reason is that this week, steel mills in the South and Southwest regions have stopped production for maintenance, steel mills in the Central region have equipment damage and are undergoing repairs, and steel mills in the East region that underwent maintenance last week have resumed production this week for equipment debugging. Finished material prices continue to weaken, and due to weak demand, steel mills' inventory has accumulated, with some electric furnace plants experiencing shrinking profits and entering a loss-making state, thus reducing production time and lowering production saturation. In recent situations, the number of loss-making electric furnace plants has increased, while half of the shutdown and maintenance electric furnace plants are expected to resume normal production, and the independent electric arc furnace plant's operating rate and capacity utilization rate may continue to decline slightly.

In summary, raw material prices are fluctuating downward, and the support for the carburant market remains weak. There may be a decline in the demand side, and it is expected that domestic carburant prices will remain weak and stable in the short term. For more information on the carburant market, feel free to contact us.