Petcoke prices in India resume upward trend

Following an easing of petcoke prices in August, petcoke prices are increasing again in India, adding further cost pressures to cement producers.

A key fuel for the country’s cement plants, petcoke is mainly imported from the US or Saudi Arabia. However, when Hurricane Harvey struck the US at the end of August, several US Gulf refineries closed. This led to a shortage of petcoke ad saw local petcoke prices rise.

"Prices for petcoke in the US Gulf have increased roughly 10 per cent in the past few weeks, as spot supply tightened as a result of refinery closures due to Hurricane Harvey. Market participants estimate roughly 500,000t of petcoke production was lost due to the closures, which has meant a lack of available tonnes in the spot market as overseas demand remains strong," Andrew Moore, managing editor of Platts Coal Trader, part of S&P Global Platts.

In 2016 India imported some 8.3Mt of petcoke and the rise in price comes at a time when cement producers are already facing challenges in terms of production costs. Imported coal and diesel prices have also remained relatively high in recent times with raw material and freight costs affecting company margins.

Weak demand has also softened selling prices of cement and squeezed margins even further.