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Manufacturers Adopt Plug-and-Play Mode to Meet Volatile Demand during COVID-19 Crisis

The coronavirus crisis has caused a slowdown in business activities in the needle coke market. Poor market sentiments have lowered the demand for goods and services, thus stalling the manufacturing activities at steel plants resulting in a decline in the use of needle coke. Manufacturers in the market are adopting the plug-and-play mode for the production of needle coke as per consumer demand. They are using contingency planning to predict uncertainties caused due to the pandemic since the risk of new COVID-19 variants is prevalent.

Thus, to stay financially afloat by adapting to fluctuating demand and supply trends, companies in the needle coke market are conducting strategic planning of their investments and debts. They are focusing on essential industries and its mission-critical projects to keep economies running during the pandemic. Manufacturers are maintaining robust supply chains with end users in the steel industry and the lithium-ion battery market.

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Fluctuating Prices of Graphite Electrodes Affect Business Margins

In terms of both value and volume, Asia Pacific is taking the lead among all regions in the needle coke market. Companies in India such as HEG Ltd - a premier company of the LNJ Bhilwara group and graphite electrode manufacturer, is bullish on maximizing its production and exports on a global level. Despite having proprietary technology to produce graphite electrodes, manufacturers face volatility in prices and availability of needle coke, especially when the demand for graphite electrode gauges an upward trend. Hence, manufacturers are expecting an increase in the prices of graphite electrodes, which will help to increase business margins.

Manufacturers are increasing efforts to broaden their supply network for the production of lithium-ion batteries, specialty carbon, and in nuclear furnaces to overcome the volatility in prices for raw materials and products.

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R&D Investments in Production Technologies Modernize Coking Units

R&D investments in production technologies are gaining importance in the needle coke market. Gazprom Neft - a vertically integrated oil company engaged primarily in oil & gas explorations, announced that its needle coke production technology has been included in state pending agency; Rospatent’s annual ratings of Russia’s top-10 most important inventions. Companies in the needle coke market are taking cues from such innovations and anticipated to collaborate with specialists to advance in the production of needle coke.

Though graphite electrodes are estimated to dominate the highest revenue share among all application types in the market, the revenue of lithium-ion batteries is predicted for exponential growth during the assessment period. Patent-worthy production technologies are modernizing coking units.

Technological Advancements Reduce Dependence on International Markets for Needle Coke

Needle coke is being increasingly used to produce graphite electrodes that are consumed in steel and aluminum production furnaces. Mott Corporation - a specialist in filtration and flow control engineering, is creating awareness about their filter, which can be utilized to filter the needle coke production feedstock to remove contaminants. This ensures the consistent production of high-quality needle coke products.

Companies in the needle coke market are increasing efforts to achieve scientific and technological advancements to improve the production of graphite electrodes. Manufacturers in Russia are increasing their R&D expenditure to reduce the industry’s dependence on international supplies for needle coke and its related products. This will help Russian stakeholders to increase exports for needle coke and its products including graphite electrodes.

Sophisticated Carbonization Technologies Give Rise to High Value Petroleum-based Needle Coke

The needle coke market is expected to cross US$ 5 Bn by the end of 2031. GrafTech International Ltd. - a manufacturer of graphite electrodes and petroleum coke, is gaining recognition for one-of-its-kind standalone petroleum needle coke plant Seadrift. As such, petroleum derived needle coke is predicted to register a higher revenue and volume share as compared to coal tar pitch derived needle coke.

Companies in the needle coke market are investing in plants that are unfettered by the demand and constraints of typical oil refineries. This ensures an integrated and premium supply of petroleum derived needle coke. Sophisticated carbonization and microscopy technologies are being deployed to increase the availability of high value petroleum-based needle coke.

Preference for Petroleum Needle Coke over Coal Pitch Needle Coke for Lithium-ion Batteries

Calcined needle coke is used in graphite electrode manufacturing for the steel industry. However, in the past three to four years, lithium-ion batteries are emerging as the new demand center for needle coke. Manufacturers in the needle coke market are increasing their production capabilities to help end users utilize calcined needle coke for the production of carbon anode of lithium-ion batteries. These carbon anodes are emerging as an alternative to natural graphite, owing to technological advancements and quality consistency being achieved with carbon anodes.

Petroleum needle coke is preferred over coal pitch needle coke, due to its greater energy density. In this way, manufacturers in the needle coke market are unlocking revenue opportunities in lithium-ion batteries with long driving ranges and longevity.

Improved Coal-based Needle Coke Production Technology Gives Rise to Specialty Carbon Products

The high quality carbon products are fueling the demand for needle coke. C-Chem Co. Ltd. - a carbon subsidiary of Nippon Steel & Sumikin Chemical Co. Ltd., is being publicized for its flagship products in high-grade pitch coke specializing in the production of synthetic graphite electrodes and specialty carbon. Companies in the needle coke market are improving their coal-based needle coke production technology to innovate in specialty carbon products that are in high demand for advanced fields such as nuclear power and semiconductor manufacturing equipment.

Specialty carbon products are being used in solar power generation. Manufacturers are procuring large volumes of raw materials to increase the availability of high value carbon material products. The abundance of raw materials ensures a stable supply of needle coke and its related products for specialty carbon materials, graphite electrodes, and for lithium-ion batteries.

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Analysts’ Viewpoint

Since the graphite electrode business is dependent on the steel industry, a slowdown in the steel sector during the COVID-19 crisis has caused a negative impact in the graphite electrode sector. The needle coke market is slated to clock a modest CAGR of ~5% in terms of value during the forecast period. This is evident since availability and price fluctuations of needle coke tend to exert pressure on business margins. Hence, companies should increase their stock of raw materials and increase R&D in proprietary technologies to overcome price uncertainties linked with needle coke. Manufacturers should leverage incremental opportunities in lithium-ion batteries and specialty carbon products.

Needle Coke Market: Overview

  • Needle coke is commonly used as a heating element. It is obtained by petroleum as well as coal tar. It is highly crystalline petroleum coke used in the production of electrodes for steel and aluminum industries.
  • Manufacturers of needle coke have increased production due to rise in demand for graphite in steel and aluminum industries. Needle coke is extensively employed in graphite electrodes. Several manufacturers of graphite electrodes have invested significantly in expansion of their production facilities in the past few years. This is expected to propel the needle coke market during the forecast period.
  • According to Transparency Market Research’s latest research report on the global needle coke market for the actual year of 2020 and the forecast period of 2021 to 2031, rise in usage of needle coke in applications such as lithium ion batteries (anode), graphite electrodes, and others (specialty carbon, nuclear furnace, etc.) is a key factor that is expected to boost the global needle coke market during the forecast period
  • In terms of revenue, the global needle coke market is expected to cross US$ 5 Bn by 2031, expanding at a CAGR of ~5% during the forecast period

Increase in Demand for Graphite Electrodes: Key Driver of Needle Coke Market

  • The usage of needle coke in battery manufacturing industry has been rising significantly, especially in developed and developing economies such as the U.S., the U.K., India, and Japan. Growth of the industry can be ascribed to rise in the demand for steel and increase in government initiatives in growing markets such as India to encourage foreign investment in the metal industry.
  • Needle coke is a major raw material for graphite electrodes, which, in turn, is used for the manufacture of steel. Needle coke represents ~70% of the input cost of graphite electrode production. China is the largest producer and consumer of steel, despite decline in the demand for steel in the country compared to that in 2015. Increase in demand for needle coke in India and other countries in Asia, North America, and the European Union (EU) is anticipated to compensate for the decline in demand for steel in China.
  • Environmental regulations in China are becoming increasingly stringent. This suggests that operating blast furnace-blast oxygen furnace (BOF) processes using iron ore is likely to incur increasingly higher environmental taxes, compared to plants using the electric arc furnace (EAF) process. Currently, the supply of steel scrap in China is declining, due to closure of a large number of induction furnaces. However, in the long term, supply of domestic steel scrap is set to increase at a rapid pace, along with electricity supply. These factors are fueling the usage of the EAF method for the production of steel.

Rise in Usage of Lithium-ion Batteries to Drive Needle Coke Market

  • Needle coke is the major heating element in the EAF for steel production. It takes 2 kg to 3 kg of graphite electrodes to produce one ton of steel. It takes up to six months to make these electrodes. Furthermore, significant amount of needle coke is employed in the production of lithium-ion batteries. However, needle coke production is limited to a few suppliers, the prominent being the U.S. oil major Phillips 66 and Japan's C-Chem Co Ltd. Most refineries do not produce needle coke, as it takes longer to produce compared to the traditional forms of petroleum coke.

Graphite Electrodes Dominate Needle Coke Market

  • In terms of application, the graphite electrode segment held a major share of the needle coke market in 2020. Graphite electrodes are widely used in steel manufacturing. The graphite electrodes segment is expected to expand at a CAGR of 3.7% during the forecast period.

Needle Coke Market: Competition Landscape

  • Detailed profiles of providers of needle coke have been included in the report to evaluate their financials, key product offerings, recent developments, and strategies
  • Key players operating in the global needle coke market are
    • Mitsubishi Chemical Holding Corporation
    • Indian Oil Corporation
    • Phillips 66
    • JXTG Holdings Inc.
    • Seadrift Coke L.P.
    • C-Chem Co.,LTD
    • Petroleum Coke Industries Company K.S.C
    • Baotailong New Material Co., Ltd.
    • Bao-steel Group
    • Sinopec Shanghai Petrochemical Company Limited
    • Shanxi Hongte Coal Chemical Co Ltd
    • Sinosteel Anshan Research Institute of Thermo-Energy Co.
    • Petrochina International Jinzhou Petrochemical Co., Ltd
    • Shijiazhuang Deli Chemical Co.
    • Petrocokes Japan Ltd.

Needle Coke Market: Key Developments

  • Key providers of needle coke, such as Phillips 66, Indian Oil Corporation, and Mitsubishi Chemical Holding Corporation, are focusing on the expansion of needle coke facilities, owing to the rise in the demand for needle coke in various applications. Prominent developments across the globe are highlighted below:
    • In August 2020, Phillips 66 announced its plans to reconfigure its San Francisco Refinery in Rodeo, California, to produce renewable fuels. The plant would no longer produce fuels from crude oil, but instead would make fuels from used cooking oil, fats, greases, and soybean oils.
    • On June 16, 2021, ENEOS Holdings, Inc. and Ample, Inc., the U.S-based startup that ENEOS invested in, announced a business collaboration to launch an EV battery swapping service in Japan
    • In December 2020, Mitsubishi Chemical Holdings Corporation established a wholly owned subsidiary in Singapore, Mitsubishi Chemical Holdings Asia Pacific Pte. Ltd. (MCHAP), to take responsibility for regional representation, risk management, and compliance in Asia Pacific
  • In the global needle coke market report, we have discussed individual strategies, followed by company profiles of providers of needle coke. The ‘Competition Landscape’ section has been included in the report to provide readers with a dashboard view and company market share analysis of key players operating in the global needle coke market.

Needle Coke Market – Scope of Report

The latest study collated and published by Transparency Market Research (TMR) analyzes the historical and present-day scenario of the global needle coke market in order to accurately gauge its future growth. The study presents detailed information about the important growth factors, restraints, and trends that are creating a landscape for the growth of the global needle coke market so as to identify growth opportunities for market stakeholders. The report also provides insightful information about how the global needle coke market would expand during the forecast period of 2021 to 2031.

The report offers intricate dynamics about different aspects of the global needle coke market, which aids companies operating in the market in making strategic development decisions. TMR’s study also elaborates on significant changes that are highly anticipated to configure growth of the global needle coke market during the forecast period. It also includes a key indicator assessment that highlights growth prospects of the global needle coke market and estimates statistics related to growth of the market in terms of volume (kilo tons) and value (US$ Mn).

This study covers a detailed segmentation of the global needle coke market, along with key information and a competition outlook. The report mentions company profiles of players that are currently dominating the global needle coke market, wherein various development, expansion, and winning strategies practiced and implemented by leading players have been presented in detail.

Key Questions Answered in TMR’s Report on Needle Coke Market

The report provides detailed information about the global needle coke market on the basis of a comprehensive research on various factors that are playing a key role in accelerating the growth potential of the global market. Information mentioned in the report answers path-breaking questions for companies that are currently operating in the market and are looking for innovative methods to create a unique benchmark in the global needle coke market, so as to help them design successful strategies and make target-driven decisions.

  • Which application segment of the global needle coke market would emerge as major revenue generator during the forecast period?
  • How are key market players successfully earning revenue out of advantages of needle coke?
  • What would be the Y-o-Y growth trend of the global needle coke market between 2021 and 2031?
  • What are the winning imperatives of leading players operating in the global needle coke market?
  • Which segment is expected to create lucrative opportunities for the global needle coke market during the forecast period?
  • Which are the leading companies operating in the global needle coke market?

Research Methodology – Needle Coke Market

The research methodology adopted by analysts for compiling the global needle coke market report is based on detailed primary as well as secondary research. With the help of in-depth insights of the market-affiliated information that is obtained and legitimated by market-admissible sources, analysts have offered riveting observations and authentic forecast for the global needle coke market.

During the primary research phase, analysts interviewed market stakeholders, investors, brand managers, vice presidents, and sales and marketing managers. Based on data obtained through interviews of genuine sources, analysts have emphasized the changing scenario of the global needle coke market.

For secondary research, analysts scrutinized numerous annual report publications, white papers, market association publications, and company websites to obtain the necessary understanding of the global needle coke market.

Needle Coke Market – Segmentation

TMR’s research study assesses the global needle coke market in terms of type, grade, application, and region. This report presents extensive market dynamics and trends associated with different segments of the market and how they are influencing growth prospects of the global needle coke market.

  • Petroleum Derived
  • Coal Tar Pitch Derived
  • Intermediate
  • Premium
  • Super Premium
  • Graphite Electrodes
  • Lithium-ion Batteries (Anode)
  • Others (including Specialty Carbon and Nuclear Furnace)
  • North America
  • Latin America
  • Europe
  • Asia Pacific
  • Middle East & Africa

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Needle Coke Market

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