China's pre-baked anode prices found upward momentum in July as cost-side support re-emerged during the settlement cycle. According to Mysteel, a major Shandong-based aluminum producer raised its July prebaked anode purchase benchmark price by 30 yuan/tonne month-on-month, with settlement price at 5,683 yuan/tonne by cash and 5,707 yuan/tonne by acceptance.
Following a brief downward correction, the prebaked anode market regained traction. Although the rebound was modest, price trends aligned with rising costs of upstream raw materials, petroleum coke and coal tar pitch, allowing cost pressures to successfully transmit to finished products. The industry's overall cost shifted slightly higher, but producers remained comfortably above the breakeven line, with marginal fluctuations contained.
Throughout the month, most pre-baked anode producers maintained stable production schedules amidst concurrent plant restarts and curtailments, leaving overall operating rates largely unchanged. Supply remained ample. On the demand side, growth in domestic aluminum capacity had largely plateaued, which operated steadily and provided consistent support for anode consumption. Fundamentals for prebaked anodes remained sound.
Supply side
In July, prebaked anode enterprises generally operated smoothly. Most commercial producers in key producing regions fulfilled orders, with some continuing toll-processing agreements. Environmental protection controls in parts of Henan constrained output in those areas. In Gansu, facilities that underwent maintenance completed repairs and resumed production in late July. Integrated smelters maintained stable output primarily for captive use. In Northwest China, plants undergoing maintenance compensated for lost output by sourcing externally and utilizing outsourced baking for green blocks.
Regarding new capacity, the 600,000-tonne carbon-based project by Guangtou Qiangqiang entered trial production for its baking furnaces, while the baking workshop at Xinjiang Chenfeng Carbon's green energy-saving integration project commenced equipment linkage commissioning. Overall, concurrent restarts and cutbacks kept capacity utilization rates stable. Mysteel data's shows China's prebaked anode capacity utilization rate reached 76.53% on average in July, down 0.25 percentage points month-on-month, indicating sustained sufficient supply.
Demand side
Domestic aluminum smelters maintained steady operations in July, supporting healthy anode demand. Having largely exhausted capacity expansion in H1 2026, the industry entered July with limited incremental space but sustained high operating rates. Smelters procured pre-baked anodes at a normal pace, keeping demand robust.
On the export front, data from the General Administration of Customs of People's Republic of China (GACC) shows China exported 279,900 tonnes of prebaked anodes in June 2026, surging 109.53% YoY and 62.26% MoM. Export volumes jumped by 107,400 tonnes from May, led by significant increases from Shandong (up by 118,400 tonnes) and Hebei (up by 14,800 tonnes). Destination-wise, Canada and Malaysia saw the largest gains, up 42,600 tonnes and 39,900 tonnes, respectively. Although shipments to the UAE and Norway dipped slightly, effective offsets from exports to Spain and Angola resulted in net growth, with total June exports outperforming May.
Cost side
The domestic petroleum coke (petcoke) market saw flat trading in July, with prices mixed. State-owned refineries mostly lifted prices for low-sulfur and high-sulfur petcoke, while medium-sulfur petcoke prices fell more than they rose. In Northeast China, refineries of low-sulfur petcoke aggressively destocked in June, entering July with negligible inventories. Coupled with feedstock purchases by battery anode producers, this drove consecutive price hikes for low-sulfur coke.
Independent refineries saw increased unit overhaul, with operating units trending toward lower sulfur content, increasing the supply of standard-grade petcoke. Refineries adjusted prices based on inventory and specifications. By late July, 3B petroleum coke in Shandong traded at 3,580 yuan/tonne (up by160 yuan/tonne MoM), while 3C stood at 3,050 yuan/tonne (up by 200 yuan/tonne MoM). In East China, 3B coke was priced at 3,520 yuan/tonne (up by 100 yuan/tonne MoM).
Meanwhile, domestic coal tar pitch averages trended lower in July. Early in the month, high-priced coal tar offered cost support, lifting pitch prices briefly. However, the rally proved short-lived. From mid-month, coal tar prices retreated, eroding cost support. Concurrently, downstream plants' operating rates slipped while feedstock inventories stayed high, dampening buying interest and prompting price corrections. Late-month price stabilization followed as coal tar prices bottomed out, mitigating bearish cost impacts, while downstream buyers returned for essential replenishment. By July-end, modified pitch in Shandong closed at 4,950 yuan/tonne (flat MoM), while Shanxi prices settled at 4,750 yuan/tonne (down by100 yuan/tonne MoM).
Outlook
In August, domestic refineries are expected to slightly lift the operating rates of delayed coking units, leading to a modest increase in domestic petroleum coke supply. Import arrivals remain steady, while port destocking accelerates. Consequently, total petroleum coke availability is expected to rise marginally. Petroleum coke prices are likely to fluctuate within a steady range amid cautious downstream essential buying.
For coal tar pitch, feedstock coal tar is anticipated to stage a rebound, offering stronger cost-side support. However, rising operating rates at deep-processing plants may cap pitch price gains. Overall, pitch prices are forecast to rise marginally before stabilizing.
Concerning pre-baked anode fundamentals, scheduled restarts of maintenance units and ramp-ups from newly commissioned capacity will keep supply abundant in August, with operating rates remaining elevated as commercial producers focus on fulfilling existing orders. Domestic aluminum capacity has effectively hit its regulatory ceiling, limiting future demand growth. Nevertheless, high aluminum smelters' capacity utilization rates combined with resilient overseas demand will continue to underpin anode consumption.
Reflecting raw material cost declines during the settlement period, the prebaked anode market has turned downward again. Mysteel reports that a major Shandong-based aluminum producer cut its August purchase benchmark price by 53 yuan/tonne MoM, setting e at 5,630 yuan/tonne by cash and 5,645 yuan/tonne by acceptance. After a brief rally, prices have corrected; however, the moderate decline has fostered cautiously optimistic sentiment. The cost pressures are expected to ease slightly. Market participants will continue to monitor raw material price trajectories to gauge their impact on producer profitability.
Written by Regina WANG
wangjiaqie@mysteel.com
