China prebaked anode prices gain as costs firm; supply and demand remain balanced

Driven by firmer upstream raw material prices, cost support for China's domestic prebaked anodes continued to strengthen, and with smooth transmission along the supply chain, market quotes rose again in October 2026.

 According to Mysteel, a major primary aluminium smelter in Shandong raised its October 2026 prebaked anode purchase benchmark price by RMB 180 per tonne from September to RMB 6,310 per tonne on a cash basis and RMB 6,327 per tonne on an acceptance basis. While the increase was in line with expectations, raw material prices moved up in tandem, and the persistent rise on the cost side partly offset the gains from higher selling prices. Industry profits have recovered to some extent, but given earlier losses, overall margins remained below the break-even line, and the sector-wide loss-making pattern has yet to be reversed.

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 On the supply side, prebaked anode producers largely ran smoothly in October. Most commercial producers operated to fulfil orders, new capacity continued to add output, and some companies had spare baking furnace capacity for toll-processing. Several producers carried out maintenance on individual production lines during the month, mostly lasting three to five days, which had limited tangible impact on finished products output. In late October, parts of Henan experienced their first widespread heavy-pollution weather episode of the autumn, but the alert level was relatively low and the response was short-lived, leaving local anode output largely unaffected. Output from integrated anode facilities across regions was stable, and some producers continued to outsource green anode baking during furnace maintenance to meet their own production needs.

Overall, industry operating rates saw limited changes. In October, domestic prebaked anode capacity utilisation rates averaged 75.68 per cent, up 0.07 percentage point month-on-month. Combined with more production days, monthly output edged higher, and overall supplies remained sufficient.

On the demand side, domestic aluminium smelters maintained steady production in October, keeping demand for prebaked anodes healthy. Recently, domestic operating capacity has held high and stable, with no changes from restarts, curtailments or new capacity. Smelters' purchase and offtake rhythms remained normal, and overall anode demand was solid.

 On the export front, data from the General Administration of Customs of the People's Republic of China (GACC), showed that China exported 288,300 tonnes of prebaked anodes in September 2026, up 39.94 per cent year-on-year and 18.02 per cent month-on-month. September export volumes extended their growth trend, rising 44,000 tonnes from the previous month, with notable increases from Shanghai and Shandong, up 41,200 tonnes and 15,700 tonnes respectively. The biggest destination gains were Indonesia and Norway, up 38,600 tonnes and 20,000 tonnes respectively.

The number of destination countries fell in October, with shipments to some countries dropping to zero, but volumes to traditional consuming regions including Malaysia, Canada and the UAE remained elevated. Total national prebaked anode exports increased from the previous month.

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Looking ahead over November, although most refinery maintenance is expected to continue, domestic petroleum coke supply will likely stay at high levels. The autumn-winter heating season is expected to dampen some downstream demand, which could weigh on the petroleum coke market. Low and mid-sulphur coke prices may ease slightly in November, while high-sulphur coke prices, already at elevated levels, are expected to adjust modestly.

 Entering November, high-temperature coal tar prices are expected to soften, leaving limited cost support for coal tar pitch. Meanwhile, concentrated maintenance at deep-processing plants has largely ended, and coal tar pitch supply is expected to increase. Traditional downstream buyers are mainly restocking on rigid demand, and the coal tar pitch market is expected to trend weaker in November.

 In terms of supply and demand, most commercial anode producers are running to fulfil existing orders. Healthy overseas demand has kept export-oriented plants operating at high rates. As the northern heating season approaches, environmental controls are likely to push operating rates lower in some regions. However, short-term autumn-winter output curbs have become routine, and producers have well-established contingency plans. Combined with ongoing output releases from new and upgraded capacity, short-term domestic prebaked anode supplies are expected to remain loose.

 Domestic aluminium operating capacity is largely stable, with limited room for further increases. Future anode demand growth will mainly depend on the commissioning of replacement aluminium capacity across China, as well as the progress of new overseas aluminium projects and existing capacity restarts.

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On pricing, petroleum coke prices fluctuated during the settlement cycle, and coal tar pitch prices eased but stayed elevated. Prebaked anode quotes extended their gains. According to Mysteel, the major Shandong aluminium smelter raised its November 2026 prebaked anode purchase benchmark by RMB 182 per tonne from October to RMB 6,312 per tonne on a cash basis and RMB 6,328 per tonne on an acceptance basis.

The stronger-than-expected increase, underpinned by favourable cost factors, is expected to further narrow sector losses. That said, with the heating season approaching, coupled with still-elevated raw material prices, the market will need to track movements in petroleum coke and coal tar pitch prices, as well as the pace of autumn-winter output curtailment policies.

Note: This news is published under a content and exchange agreement with Mysteel