Rising supply and contracting demand put petroleum coke market under pressure Restocking at month-start supports expectations for stabilization [SMM Analysis]

Recently, the trading atmosphere in the petroleum coke market continued weak, with refinery petroleum coke prices diverging: mainstream refineries saw mixed changes, while local refineries faced continued pressure on shipments and falling prices. Specifically, during the week, prices of petroleum coke from CNOOC refineries continued to soften, dropping by 50-240 yuan/mt, with current prices concentrated in the range of 4,210-4,500 yuan/mt. PetroChina’s low-sulphur petroleum coke prices in north-east China held steady, with current petroleum coke prices concentrated between 4,246-4,711 yuan/mt. SMM’s spot price index for #1 petroleum coke in north-east China was recorded at 4,537.53 yuan/mt. Medium-sulphur petroleum coke prices in north-west China operated stably, with SMM’s spot price index for #3 petroleum coke in north-west China recorded at 3,737.42 yuan/mt. Sinopec refineries saw good petroleum coke shipments, with prices largely stable; moreover, due to active purchasing by downstream anode plants, some refineries in central China and Shandong saw slight increases of less than 100 yuan/mt for anode-grade coke. However, a few refineries experienced slight pullbacks in high-sulphur petroleum coke prices due to poor shipments. Local refineries performed poorly in shipments, with petroleum coke prices continuing to weaken, especially #4 coke, which showed more pronounced declines. The latest SMM data showed that the spot price index for #2 petroleum coke in Shandong was 4,002.43 yuan/mt, down 1.50% WoW; the spot price index for #3 petroleum coke in Shandong was 3,409.11 yuan/mt, down 1.85% WoW; the spot price index for #4 petroleum coke in Shandong was 1,757.79 yuan/mt, down 11.16% WoW. The imported petroleum coke market saw moderate trading during the week, with transaction prices pulling back, but traders held back supplies due to optimistic sentiment about the later market, so the decline in port petroleum coke prices was limited.

Supply side, petroleum coke market supply showed a rebound this week. The increase mainly came from the resumption of some capacity at Jincheng Petrochemical, while other domestic mainstream refineries maintained a steady production pace, resulting in a supply-side characterized by partial increases and overall stability. Demand-side performance was relatively sluggish, with downstream enterprises exhibiting strong wait-and-see sentiment, purchasing behavior returning to rigid demand dominance, and willingness for active restocking weakening. The market atmosphere for purchasing was sluggish, putting significant downward pressure on petroleum coke prices.

Based on a comprehensive analysis of supply-demand fundamentals, the current petroleum coke market is characterized by increasing supply and contracting demand. However, the release of stockpiling and restocking demand from downstream enterprises at the beginning of the month is expected to drive a slight recovery in petroleum coke demand. Additionally, the significant price increase of prebaked anodes in December has also supported the purchasing enthusiasm of prebaked anode enterprises for petroleum coke. Based on this, SMM expects petroleum coke prices to stop falling and stabilize in the short term.