According to Benchmark, needle coke prices have seen an unseasonal uptick between February and March 2024, driven by the continued shutdown of coking facilities in China after the Lunar New Year holiday.
According to Adam Megginson, an analyst at Benchmark, the typical seasonal pattern is for coking capacity in China to come back online after the Spring Festival, when many facilities undertake maintenance. However, this has largely not happened in 2024.
"We would expect coking capacity to come back online after Spring Festival when a lot of facilities opt to undertake seasonal maintenance, but this mostly hasn't happened in 2024," Megginson said.
The prolonged closures of coking plants in China have created an unexpected supply shortage of needle coke, a key raw material used in the production of synthetic graphite. This has led to a spike in needle coke prices, which are an important input cost for synthetic graphite manufacturers.
The unseasonal price increase for needle coke highlights the vulnerability of the synthetic graphite supply chain to disruptions in upstream coking operations, particularly in China which dominates global production. It also underscores the need for battery and EV manufacturers to diversify their sources of critical raw materials like graphite.
