The Supply And Demand Of Global Needle Coke Report

　　Needle coke is primarily applied in graphite electrode for electric furnace steelmaking, lithium batteries, nuclear power, aerospace, etc.. Since 2009, the global demand for needle coke has quickly rebounded in the wake of recovery of its downstream sectors. In the same period, the global needle coke giants haven’t substantially expanded capacity in order to manipulate prices, which has caused sustained tension supply in the world’s needle coke market. In 2011, the supply gap amounted to 190 kilotons, a YoY rise of 110%, and among the world’s most important consumers of needle coke, China showed the tightest supply situation.

　　As the world’s largest steel producer, China has always maintained a huge amount of demand for needle coke, and in recent years, along with the continuously optimized product mix of Chinese graphite electrode industry as well as the ever rising proportion of ultra-high power graphite electrode, the demand growth of needle coke has significantly accelerated. During the same period, due to the small number of needle coke manufacturers, weak technological strength and the prevalence of technical obstacles in terms of production stabilization and product quality control, China’s needle coke capacity has seen slow growth, accompanied by a widening supply gap of needle coke products. In 2009-2011, China’s demand for needle coke rose from 161 kilotons to 380 kilotons, with a CAGR of 53.6%, while the annual capacity only grew to 132 kilotons from 130 kilotons. Since there are many technical hurdles for the vast majority of enterprises newly involved in the needle coke business, combined with the limited capacity growth, it is expected that the Chinese needle coke market in the next two years will continue the tight supply situation.

　　China abounds in coal but lacks oil, with adequate supply of raw materials for coal-based needle coke and more mature related technology, therefore, the overwhelming majority of the existing domestic needle coke capacity and the planned or under-construction needle coke projects pertain to the coal-based needle coke, and oil-based needle coke project occupies a small proportion. In terms of the demand, large size, ultra high power graphite electrode products have already become a development priority for the graphite electrode industry, and the oil-based needle coke is more suitable for the preparation of this product by virtue of compositional characteristics. Therefore, the needle coke market in China has once again presented a structural imbalance between supply and demand. In the future, as the supply gap widens, oil-based needle coke will prove to be a new investment hotspot for the needle coke industry in China.

　　In addition to the development of global and China needle coke industry, this report also highlights needle coke business of seven foreign companies, i.e. ConocoPhillips, Seadrift, JX, C-Chem, MC, Petrocokes and Indian Oil, as well as twelve Chinese peers such as Shanxi Hongte Coal Chemical Industry Co., Ltd., Jinzhou Petrochemical Company and Sinosteel Anshan Research Institute of Thermo-energy Co.,Ltd.

　　ConocoPhillips is the world’s largest manufacturer of oil-based needle coke, with stable capacity of needle coke recently, about 370 kilotons per year. Being one of the deciders of global oil-based needle coke prices, it has managed two price hikes of needle coke products worldwide since 2009.

　　As the world’s second largest producer of oil-based needle coke and a promoter of the year 2012 global needle coke price inflation, Seadrift has needle coke capacity of 150 kilotons annually. In 2010, it was acquired by the largest USA-based graphite electrode producer GTI; according to the parent company’s plan, Seadrift will achieve an annual capacity of 240-250 kilotons in the long run.

　　C-Chem, a professional carbon product manufacturer affiliated to the Nippon Steel Corporation, is the world’s largest coal-based needle coke producer. In recent years, its needle coke capacity has been effectively enhanced via expansion to 170 kilotons in 2012.

　　As China’s first coal-based needle coke manufacturer that realizes industrialization, Shanxi Hongte Coal Chemical Industry embarked on the construction of the 100-kiloton coal-based needle coke project from 2008 so as to meet domestic demand. In April 2011, this project was put into trial operation; in 2012, the needle coke capacity reached 150 kilotons/a.