Features CW Research: Green petcoke market to reach USD 13 billion by 2021 14 December, 2020 SHARE THIS ARTICLE Share Tweet Post Email LATEST Plant Expansions Holcim breaks ground of revolutionary GO4ZERO plant Europe's decarbonization leap May 16, 2024 Financial Cementos Argos shares first quarter results Insights into cement giant's Q1 performance May 16, 2024 MOST READ Markets & Competition Botswana to ban cement imports Government implements cement import ban to reduce import May 07, 2024 Environment Sinoma and Heidelberg Materials unveil new Collaboration signals green era for cement industry May 10, 2024 CW Research: Green petcoke market to reach USD 13 billion by 2021 Green petcoke demand will expand both on supply-side factors as well as on expanding end-user industrial demand. In 2017 alone, demand for global green petcoke will surpass 137 million tons A new important driver for the sector is Reliance India's gasification project in Gujarat. This large gasification project has been in the work for a long time, but it seems like the first units will finally come on-line in the second half of 2017 and, when fully up and running, will absorb 8-10 million tons. Longer-term, petcoke demand growth will be driven by fuel-grade petcoke from the cement sector, albeit slow growing, and anode-grade petcoke (in calcined form) from aluminum. Robert Madeira, CW Research's Managing Director and Head of Research stresses: ÔÇ£We donÔÇÖt see any major changes in the world outlook for green petcoke, but especially petcoke demand from the cement sector is at increasing risk; reducing cement-clinker ratios, alternative fuel substitution, CO2-NOx-SOx emissions pressures, all combine to provide a negative long-term outlook for petcoke use. While nothing is likely to happen overnight, this poses a big strategic challenge for petcoke producers / refiners and marketers to grapple with ÔÇô the time is now to tackle this seismic shift. ÔÇØ With structural price headwinds, we expect that the fuel grade sector will be under more pressure as additional supplies come online. CW Research's petcoke price forecast implies that weaker prices will not be offset fully by expanding volume growth, leading to a flag-to-negative trend in the USD market size. The anode grade segment is however expected to see stronger pricing, given the tight calcining market. Environmental constraints to dampen petcoke demand Globally, cement manufacturing, which uses petcoke to pyro-process limestone, is the most intensive green petcoke demand segment, accounting for almost 40% of total consumption. China is the largest cement producer and also the largest petcoke user worldwide, although petcoke figures only as a minor share in the Chinese cement sector's fuel portfolio. Anode petcoke is the predominant type of petcoke used in China, specifically by the aluminum manufacturing sector. The Chinese aluminum sector alone uses 11% of the global supply of anode grade petcoke. Manufacturers in the Chinese cement sector prefer the cheaper and more readily available coal to fuel clinker fuels, in the detriment of green fuel grade petcoke. ÔÇ£There is tremendous uncertainty around the future of green petcoke, particularly fuel grade petcoke,ÔÇØ asserts Raluca Cercel, CW's Senior Consulting Analyst. She adds: ÔÇ£anode grade petcoke often has no substitute in its applications, making it an indispensable commodity. Logically, we see this dynamic play out in pricing for the two product types and we expect this trend to persist.ÔÇØ Several factors are expected to impact marketable production of petcoke in the long term. Among them is the International Maritime Organization's regulation on heavy fuel oil that will lower demand for heavy fuels and require potentially more upgrading in the refineries of the feedstock and in turn produce more petcoke. Additionally, environmental scrutiny in key markets such as China and India have introduced uncertainty around the future path of petcoke in those countries. While we donÔÇÖt expect outright bans India is making the case for much stricter environmental regulation and/or tax. China is also guiding away from high sulfur petcoke, even though it is debatable if it can be classified as a ÔÇ£banÔÇØ. Nonetheless, globally speaking, despite the pick-up in alternative fuels within the cement sector and the application of environmental regulations, CW Research expects the petcoke sector to show a moderately growing trend. According to Raluca Cercel, ÔÇ£compared to the demand growth rate between 2010 to 2016 CAGR, we expect growth to slow down. The cement sector, the largest user of fuel grade petcoke, will decrease its petcoke usage in the fuel mix. Still, this reduction will not offset the volumes of fuel grade anticipated to be absorbed by Reliance's gasifiers.ÔÇØ Specialty petcoke product segments, including needle coke, are expected to show the highest growth in the coming years, jumping from a share of 1% of green petcoke consumption to 2%. With few substitutes and facing lower price sensitivity due to their premium nature, end-user industries, including titanium oxide manufacturing, graphite electrode production for steel applications, will drive up higher volumes and values for these products. Find out more about the report here Sign in Don't have any account? Create one SHOW Forgot your username/ password? 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