The world coke consumption was 357 million tonnes in 2001, which has grown to 698 million tonnes in 2007. In North America, coke production has declined over the last decade. The shortage is currently estimated at 7.5 million tonnes and is likely to increase. In UK and France each, a shortage of two million TPA has been estimated. Other European countries are also shutting capacity and coke-manufacturing capacities are being relocated to Asian countries.

China is the leading coke producer in the world. Its total consumption of coke was about 111 million tonnes in 2001 and increased to 360 million tonnes in 2008, which is estimated to grow to 450 million tonnes in 2010. Its annual coke exports have increased from around 600 tonnes in 1986 to 15.27 million tonnes in 2007, which was more than 50 per cent of the world’s total trading volume of coke. In the wake of present downturn, the exports have declined to around 80000 to 85000 tonnes monthly, as is clear from the December’08 and January’09 figures. China’s coking coal output in 2007 stood at 335 million tonnes, accounting for nearly 60% of global production. China’s coke finds market in more than 30 countries and regions in the world.

Major operating mines of coking coal are found in Bowen Basin in Australia, Shanxi in China, Western Canada and Appalachia in USA. Coking coal deposits are also available in Mozambique, Mongolia, Elga in Russia and Maruwai in Indonesia.

Coke is one of the major input in steel making. Rapid economic growth and on-going domestic infrastructure developments in the Chinese steel market is propelling the global steel demand. The global steel industry is likely to resurface from the volatile conditions witnessed in the recent past. The spurt in demand is projected to aid in rapid industry consolidations and capacity expansions mostly in China and other countries in the Asia-Pacific region. China is the largest steel market as well as the largest producer of steel in the world. Demand for steel in China is projected to reach 595 million metric tonnes by the year 2010, at a very high CAGR of about 16%, as stated by Global Industry Analysts, Inc. United States is the second largest market and the steel consumption was estimated to be over 133 million metric tonnes for the year 2007. Global Steel Market to Cross 1.5 Billion Metric Tonnes by 2009.

The steel industry in China, which represents 36% of global steel output, accounts for nearly 70 per cent of the total demand for coke. The rapid infrastructure development in China has turned the country into a steel importer as opposed to its traditional status of being a steel exporter. Consequently, coke being produced in China is being consumed internally. This has created a major imbalance in the worldwide coke trade.

The graph depicts the extreme price volatility of coking coal and coke prices. Coke prices, like that of all other commodities are cyclical in nature. While many try to ride the cycle, no one can claim complete knowledge of the same, which continues to baffle and burn with impunity.

At Gujarat NRE Coke, we, having faith in our self and our long term commitment to the business, ensure that every time the prices go down, we use the downturn to invest in capacities, to create  and enhance our production facilities so that when the inevitable upturn comes, we are able to produce and create more wealth.