The prices of calcined petroleum coke (CPC or pet coke), used as a raw material for aluminium production, have doubled in the last two years. CPC jumped almost 50 per cent this year and is now quoting at $750 a tonne.
The prices of CPC are driven by the global markets and move in tandem with crude prices. As the crude prices are ruling lower around $122 a barrel from the peak level of $147 late last month, CPC is likely to ease in the months ahead. The price may settle down between $580 and $600 a tonne during this year.
India produces about 0.5 million tonnes of CPC, which is equivalent to the domestic consumption. But as the aluminium companies are going global, the demand for CPC is likely to grow by leaps and bounds.
By the end of 2009, around 1.5 million tonnes of aluminium capacity is likely to be added to the existing global output of 18 million tonnes. Of this, the Asian region is set to get about 40 per cent. China is estimated to kickstart 0.225 million tonnes of additional aluminium projects, while India is set to add 0.075 million tonnes. The fast-emerging West Asia is likely to add 0.120 million tonnes of fresh capacity by 2009. All these plans require additional CPC to the tune of 0.6 lakh tonnes at an average consumption of 400 kgs for each tonne of finished aluminium produced, said Shrinivas V Dempo, chairman of Goa Carbon (GCL), the country’s largest CPC producer.
India produces about 1.2 million tonnes of aluminium and this is estimated to double to 2.5 million tonnes by 2011-12. An additional 0.5 million tonnes of CPC would be required to meet the domestic requirement. Goa Carbon plans to add about 0.1 million tonnes at its existing facility in Paradip at an investment of Rs 100 crore.
Meanwhile, since January 2007, GCL has suspended all its long-term contracts to sell products through over-the-counter (OTC) market. Fortunately, it has passed on the price rise to its consumers.
