Market Trends of Petroleum Coke and Coal Tar Pitch Diverge, Putting Pressure on Prebaked Anode Prices [SMM Weekly Review of Prebaked Anode]

SMM, May 29:

Raw Material Side: In the petroleum coke market, refinery shipments showed mediocre performance, and downstream enterprises were cautious in their purchasing sentiment, leading to a continuous decline in refinery petroleum coke prices. Specifically, this week, CNOOC's petroleum coke prices mainly declined, with drops ranging from 100-150 yuan/mt, and the current price range is 3,300-3,400 yuan/mt. Binzhou Petrochemical is still under maintenance and has not provided a quote. PetroChina's refineries in the northeast region had relatively ordinary shipments during the week, with sufficient supply, and petroleum coke prices remained stable, with the current price range at 3,350-3,650 yuan/mt. It was also learned that Dagang Petrochemical reduced its prices by 200 yuan/mt during the week. Sinopec's refineries had ordinary trading in petroleum coke, with prices dropping by 60-220 yuan/mt during the week. For local refineries, downstream enterprises had a strong wait-and-see sentiment during the week, and refinery shipments were poor, leading to a continuous decline in petroleum coke prices. According to SMM data, the average price of petroleum coke at local refineries is approximately 2,267 yuan/mt, with a week-on-week (WoW) decline of about 6%. In the coal tar pitch market, prices continued to rise this week. As of Thursday, the average price of coal tar pitch was 4,077 yuan/mt, up 4.58% WoW. Overall, the cost side of prebaked anodes continued to loosen.

From the supply perspective, prebaked anode enterprises continued the strategy of "produce based on sales." This week, the industry's operating rate remained stable, with no significant fluctuations in production schedules. Market supply maintained a dynamic balance, with no significant increases or decreases. On the demand side, with the southward shift of aluminum capacity in Shandong and regional adjustments in aluminum capacity, overall capacity operated smoothly.

Brief Commentary: The raw material market for prebaked anodes showed differentiation during the week. Petroleum coke prices continued to weaken, while coal tar pitch prices extended their gains. According to SMM data, as of May 29, the cost of prebaked anodes in China was approximately 4,742 yuan/mt, down 3.23% WoW, with the support from the raw material side continuing to loosen. Some refineries resumed production after maintenance ended during the week, increasing the supply of medium- and high-sulphur petroleum coke. Coupled with the wait-and-see attitude of downstream enterprises in the petroleum coke market at month-end, market trading activity declined, and petroleum coke prices continued to fall. Although the holiday was approaching, downstream enterprises did not show significant stockpiling activities, maintaining purchasing as needed. Overall, there was no obvious positive support on both the supply and demand sides of the petroleum coke market, and it is expected that petroleum coke prices will continue to weaken in the short term. Affected by the continued weakness in the raw material market, prebaked anode prices are expected to decline in June, with a drop of 150 yuan/mt. In the future, it is necessary to continue to monitor the supply and demand changes and price trends in the prebaked anode and its raw material markets.

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