AICE Expert Insights | Dual Focus on Going Global and Green Electricity to Overcome Domestic Capacity Bottlenecks Requires International Layout

Current State of the Domestic Prebaked Anode Industry

Trend of Supply Structure Optimization

1. Capacity Concentration: The industry is accelerating the elimination of outdated capacity, with top-tier enterprises (such as Sunstone Development) expanding market share through technological upgrades and mergers and acquisitions, leading to a continuous increase in the CR10 share.

2. Green and Low-Carbon Transition: Driven by policies, prebaked anode production is upgrading towards lower energy consumption and emissions, with an increased application ratio of clean energy (such as green electricity), promoting structural adjustments in the industry.

3. Regional Layout Optimization: Capacity is gradually concentrating in regions with energy cost advantages or proximity to downstream aluminum bases, reducing logistics costs.

Changes in Competitive Landscape

Complementary prebaked anodes and commercial prebaked anodes form a differentiated competition based on cost, with leading enterprises in commercial prebaked anodes, such as Sunstone, capturing incremental markets through technological and service advantages.

The export market is boosted by the expansion of overseas aluminum capacity, enhancing the international competitiveness of domestic top-tier enterprises.

Drivers of Demand Growth

1. Boost from the Aluminum Industry

Under the "ceiling" restriction on domestic aluminum capacity, replacement of existing capacity and technological upgrades (such as large current electrolytic cells) are increasing the demand for high-quality prebaked anodes. The growth in aluminum consumption driven by new energy (PV, NEVs) and ultra-high voltage power grid construction indirectly boosts the demand for prebaked anodes. The increase in the proportion of secondary aluminum has a limited impact on anode consumption (secondary aluminum production has low energy consumption, but anode demand is still strongly related to primary aluminum capacity).

2. Incremental Overseas Market

Electrolytic aluminum capacity expansions in the Middle East and Southeast Asia, Chinese prebaked anode exports rely on cost-effectiveness, but need to address trade barriers (such as carbon emission taxes).

Future Challenges and Opportunities

1. Core Challenges

Cost Pressure: Fluctuations in raw material prices, such as petroleum coke and coal tar pitch, require companies to reduce costs through supply chain management and process optimization.

Technological Barriers: Downstream requirements for anode consistency and conductivity are increasing, making the development of highly adaptable, long-life anodes a key competitive factor.

Policy Risks: Environmental protection-driven production restrictions and dual controls on energy consumption and energy intensity may disrupt the pace of regional capacity releases.

2. Growth Opportunities

Catalyzed by the "dual carbon" goals: Companies leading in green electricity integration and carbon footprint management are expected to receive policy support and customer premiums.

Integrated Layout: Vertically extending into the petroleum coke supply chain or horizontally expanding into lithium battery anode materials (with some process synergies) to enhance anti-cyclical capabilities.

Overseas Plant Construction: Following Chinese aluminum enterprises going global (such as in Indonesia and the Middle East), establishing overseas anode capacity to circumvent trade barriers.

Industry Forecast

Short-term (2024-2025): Domestic demand growth is expected to stabilize (around 3-5%), while export growth will remain high (8-10%), with profits concentrating among top-tier enterprises.

Long-term (to 2030): Global prebaked anode demand is expected to have a CAGR of about 4%, with China accounting for over 60%, and the supply structure further tilting towards efficient and green capacities.

The industry is entering a phase of refined competition, where the ability to iterate technology and control costs will determine a company's competitive edge. Breaking through domestic capacity bottlenecks requires an international layout, and the application of green electricity is the core path to reducing carbon costs.