NEEDLE COKE MARKET ANALYSIS

The global needle coke market size was valued at USD 2.7 Bn in 2022 and is anticipated to witness a compound annual growth rate (CAGR) of 10.73% from 2023 to 2030. Rising demand for specialty carbon materials from solar power generators and wind turbines is fuelling needle coke market growth. These materials have a wide range of applications and are highly beneficial for environment and the society.  Moreover, rising demand for needle coke from the steel and aluminum manufacturing industries is also augmenting market growth. Furthermore, the growing automotive industry is also a major role in development of market growth.

Global Needle Coke Market: Regional Insights

Regionally, Asia-Pacific is expected to contribute the highest revenue share in the global needle coke market during the forecast period. The market is expected to grow in this region on account of the increase in the production of graphite electrodes, growing consumption of lithium batteries, and development in electric arc furnace.

North America is also expected to exhibit significant growth during the forecast period. The market for petroleum derived needle coke in this region is anticipated to witness significant growth on account of the increasing use of specialty carbon materials, and growth in the manufacturing of graphite electrodes.

Figure 1. Global Needle Coke Market Share (%), By Region

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Global Needle Coke Market Drivers:

Growing demand for lithium ion batteries to propel market growth

Lithium ion batteries are widely used in electric vehicles including plug-in hybrid electric vehicles (PHEVs), hybrid electric vehicles (HEVs), and all-electric vehicles (EVs). Increasing penetration of electric vehicle will favor the market growth. According to the International Energy Agency, electric car sales reached a record high in 2021, despite supply chain bottlenecks and the ongoing Covid-19 pandemic. Compared with 2020, sales nearly doubled to 6.6 million (a sales share of nearly 9%), bringing the total number of electric cars on the road to 16.5 million.

Growing consumption of steel craps to augment market growth

According to International Trade Administration, in 2019, essential and optional steel makers utilized around 32 million metric lots of ferrous scrap, an increment of 11.4 per cent over the earlier year. Almost 25 million metric tons were obtained through the local scrap vendors and the rest 7 million metric tons were imported from China, the US, UAE, Saudi Arabia, Iraq, and different business sectors to India.

Global Needle Coke Market Opportunities:

Increasing focus on expanding production capacity of graphite is expected to serve major growth opportunities. For instance, in August 2020, Epsilon Carbon commissioned a manufacturing facility in Karnataka to produce graphite anode electrodes for producing lithium-ion batteries. The company is likely to produce 5,000 tons of anode material annually. It also plans to triple this capacity to 15,000 tons in 2021 and to 50,000 tons per annum by 2025.

Global Needle Coke Market Trends:

Increasing demand for fuel oil from the cement industry

The growing demand for fuel oil from the cement industry and power generation industries is a recent trend to contribute positively towards the needle coke market. In addition, the increasing usage of needle coke in the manufacturing of electric arc furnaces is also projected to increase its consumption rate.

Rapid recovery of the steel production industry

The rapid recovery of the steel production industry and battery industry following the coronavirus pandemic is also projected to boost the market growth. Moreover, the rising demand for lithium-ion batteries in the automobile sector is further predicted to drive the market growth.

Global Needle Coke Market Restraints:

Strict environmental regulation to hinder market growth

For instance, recently China’s strict environmental regulation has tightened the screws on polluting industrial plants, nearly 30 percent of its graphite electrode production capacity has been shut and some provinces have restricted output.

Fluctuating price of raw material

The raw material used in manufacturing of needle coke is highly subjected to the volatility in price due to fluctuating price of crude oil. Hence, fluctuating price of raw material and product is expected to restrict the market growth.

Figure 2. Global Needle Coke Market Share (%), By Segment Type

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Global Needle Coke Market Segmentation:

The global needle coke market report is segmented into product type, application, and geography

Based on product type, the market is segmented into petroleum based and coal tar pitch based. Out of which, petroleum based is expected to dominate the global market over the forecast period as many petroleum companies have increased their explorations activities in order to meet the growing demand.

Coal tar pitch based segment is also expected to witness significant growth in the near future and this is owing to the fact that it has high carbon content.

Based on application, the market is segmented into Graphite Electrode, Graphite Electrode, and Others (Specialty Carbon Products). Out of which, Graphite Electrode is expected to dominate the global market over the forecast period as needle coke is key raw material used in the manufacturing of graphite electrode in electric furnaces.  

Other segment (Lithium ion batteries) is also expected to witness significant growth in the near future and this is owing to the increasing production of lithium ion batteries. According to the World Economic Forum, Li-ion battery manufacturing is expected to provide a revenue generating opportunity worth of USD 126 billion for China by 2030. Similarly, the European Union and the United States are likely to witness a revenue generating opportunity worth of USD 34 billion and USD 29 billion respectively by 2030.

Global Needle Coke Market: Key Developments

In April 2019, South Korea's needle coke manufacturer, Posco Chemtech - a joint venture of POSCO (60%) and Mitsubishi Corporation (40%) has announced its plans to add about 60,000 tons to its production capacity, thus bringing cheers to the GE manufacturers that are reeling under the pressure of scarce needle coke supplies.

In September 2020, Indian Oil Corp (IOC) announced its board has approved an investment of Rs 1,268 crore for setting up a needle coker unit at the firm's Paradip refinery in Odisha.

Global Needle Coke Market: Key Companies Insights

The global needle coke market is highly competitive. This is attributed to continuous launch of new technologies due to ongoing R &D and efforts by value chain participants. Moreover, key players are adopting various business growth strategies in order to expand their presence on regional as well as global basis. Some of the key players in the global needle coke market are Baosteel Group, C-Chem Co. Ltd, China National Petroleum Corporation, ENEOS Corporation, Kaifeng Pingmei New Carbon Material Technology Co. Ltd (KFCC), Mitsubishi Chemical Corporation, Phillips 66 Company, PMS Tech (a joint venture of POSCO Chemtech and Mitsubishi Chemical), Seadrift Coke L.P. (GrafTech International), Shandong Jing Yang Technology Co. Ltd, Shandong Yida Rongtong Trading Co. Ltd, Shanxi Hongte Coal Chemical Co. Ltd,  and Sinosteel Corporation

*Definition: Needle coke is primarily used in the manufacturing of graphite electrodes and specialty carbon materials for advanced applications such as nuclear power generation and semiconductor manufacturing equipment. It is also used in the production of lithium-ion battery anodes and conductive material for electric vehicles.