The price of petroleum coke (Pet Coke) in China has been on a persistent upward trend in January 2025, marking a significant 2.5% increase compared to the previous month. This surge was, primarily revolving around tight supply and the resurgence of feedstock crude oil prices.

Key Takeaways:

• Pet Coke prices in China are surging due to tight supply amid reduced production.
• Rising feedstock crude oil costs amid OPEC+ cuts and Russia sanctions increased manufacturing costs.
• Anticipated Spring Festival demand is adding pressure, despite low silicon metal demand.

As per ChemAnalyst, Pet Coke prices in China are expected to further increase in February 2025 due to low production levels and import dynamics.

The Pet Coke calcined grade and refined petroleum coke in the Shandong market has continued to surge in the week ending of January 31^st, 2025, on the back of limited availability in the spot market. Some coking units in China have either shut down or reduced their production, leading to a direct decrease in the overall supply of Pet Coke. The import of sponge coke, a key resource in Pet Coke production, has also been relatively tight. Traders are reportedly hesitant to sell their holdings, further limiting the availability of raw materials. This scarcity has led to a significant decline in inventory levels, further exacerbating the supply crunch.

The rebound in crude oil prices has also played a crucial role in driving up Pet Coke prices. Crude oil is a major feedstock in the production of Pet Coke, and any fluctuations in its price directly impact the manufacturing costs. The recent surge in crude oil prices in January 2025 was attributed to OPEC+ production cuts. The extension of the OPEC+ production reduction agreement until the end of the first quarter of 2025, coupled with compensatory production cuts by some oil-producing countries, has tightened the global crude oil supply. Increased US sanctions on Russia have raised concerns about potential supply disruptions, further fueling the upward trend in crude oil prices.

With the Chinese Spring Festival approaching on January 28^th, 2025, there was an anticipated increase in demand for Pet Coke as downstream enterprises seek to replenish their stocks ahead of the holiday. This anticipatory demand, coupled with the already tight supply situation, has further propelled the price surge.

Henceforth, despite the low demand from the downstream silicon metal production sector, the Pet Coke market has remained robust due to supply constraints and the resurgence of crude oil prices. The limited spot market availability has forced manufacturers to adjust their prices upwards, reflecting the prevailing market dynamics.