May Petrochemical Coke Market Overall Shakes Up

May 31st news

According to the commodity analysis system, the price of petroleum coke from local refineries in May first increased and then decreased, with a slight rebound at the end of the month, showing an overall downward trend for the whole month. The average price of medium-sulfur petroleum coke products from major local refineries in China was 3,141.00 CNY/ton on May 31, down 0.34% from 3,151.75 CNY/ton on May 1.

On the cost side: In May, international crude oil prices declined. The primary factor behind this was the rapid shift from the previous geopolitical conflict premium to a combination of easing negotiation expectations and negative fundamental factors. Under the combined influence of four key factors—the signals of resumed U.S.-Iran talks, the partial resumption of shipping through the Strait of Hormuz, the IEA’s downward revision of supply-and-demand forecasts, and the sharp increase in API inventories—earlier risk premiums in oil prices have largely dissipated, leading to a downward trend in crude oil prices. Coupled with weak global demand and concerns that escalating geopolitical tensions could weigh on the economy and oil consumption, the crude oil market has experienced a significant decline.

Supply side: Supported by the spring maintenance of refineries and a temporary tightening of supply, the price of petroleum coke increased in early May. Subsequently, as downstream purchasing resistance intensified and some facilities resumed production, bringing additional supply pressure, the price of petroleum coke fluctuated and declined in mid-May. By the end of the month, downstream rigid demand for restocking supported the petroleum coke market. The supply of imported petroleum coke was limited, and port inventory continued to decline, further exacerbating the tight supply of medium and high sulfur coke, providing some support to prices.

On the demand side: The electrolytic aluminum industry still has solid underlying demand, but affected by fluctuations in aluminum prices, companies are becoming more cautious in their procurement, mostly opting for just-in-time purchasing. Although the operating rates in the carbon and negative electrode material industries have rebounded somewhat, acceptance of high-priced petroleum coke remains limited, and companies are reluctant to commit to buying at higher prices.

Market Forecast: On the supply side, maintenance shutdowns at independent refineries continue to provide support, while imports remain limited. On the demand side, the operating rates in downstream industries such as aluminum-carbon products and negative-electrode materials are steadily recovering, and rigid demand procurement continues to be released. However, as prices keep rising, downstream buyers are becoming increasingly reluctant to pay higher prices, and their willingness to chase higher prices has weakened. Some companies are now focusing primarily on purchasing only what they need, which will help curb excessively rapid price increases. Overall, in the short term, petroleum coke prices are likely to remain stable at high levels.