July 21, 2024

Growing Use Of Graphite Electrodes In Electric Arc Furnaces Projected To Boost The Growth of Needle Coke Market

The global Needle Coke Market is estimated to be valued at US$ 2.99 Bn in 2023 and is expected to exhibit a CAGR of 10% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:

Needle Coke is a specialty carbon material primarily used to produce graphite electrodes for electric arc furnaces in steel mills. It is blended with coal tar pitch and binders and extruded into the form of a needle shape to manufacture graphite electrodes. Graphite electrodes are used in steel mills as current carrying rods in electric arc furnaces for the production of steel from scrap. Needle Coke made electrodes have high mechanical strength, corrosion and heat resistance. Growing steel production is driving the demand for Needle Coke globally.

Market Key Trends:

One of the key trends in the Needle Coke market is the growing preference for electric arc furnaces over blast furnaces for steel production. Electric arc furnaces require Graphite electrodes to conduct electricity and melt scrap steel. They offer benefits like lower capital cost, flexibility to process scrap and higher energy efficiency over traditional blast furnaces. According to World Steel Association (WSA), the share of crude steel production from electric arc furnaces is increasing steadily and expected to rise further. This will boost the demand for needle coke used to produce graphite electrodes for electric arc furnaces in the coming years.

Porter’s Analysis:

  • Threat of new entrants: The needlec coke industry requires high capital investments for setting up the production facilities. Furthermore, the industry is consolidated with few key players controlling the global production. These factors limit the threat of new entrants.
  • Bargaining power of buyers: The buyers have moderate bargaining power as needlec coke has limited substitutes and switching costs for buyers are high.
  • Bargaining power of suppliers: The suppliers have moderate bargaining power due to limited availability of raw materials and long term supply contracts between buyers and suppliers.
  • Threat of new substitutes: There are limited substitutes for needlec coke owing to its unique properties required for manufacturing graphite electrodes used in electric arc furnaces for steel production.
  • Competitive rivalry: The industry faces high competitive rivalry due to dominance of key global players.

Key Takeaways

The global needlec coke market is expected to witness high growth, exhibiting CAGR of 10% over the forecast period, due to increasing demand for electric arc furnace steel production. The market size for 2023 is estimated to reach US$ 2.99 Bn.

China dominates the global needlec coke market owing to large domestic steel production. Asia Pacific as a whole contributes over 60% of the global production. China is also a major exporter of needlec coke to other Asian countries and the United States.

North America is another major market for needlec coke driven by presence of key manufacturers. The region is expected to witness strong growth led by increasing capacity additions for electric arc furnaces by steel producers in the US.

Key players operating in the needlec coke market include 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. The industry is consolidated with top 5-6 players controlling over 50% of the market share.