Coal Tar Pitch (CTP) Market Trends

Growth Drivers

• Expanding graphite electrode market: Graphite electrodes are critical components of electric arc furnaces (EAF) in the steel sector. A coal tar pitch is also used to bond these electrodes together in the manufacturing process. Demand for electrodes is rising because the global steel sector is making large shifts away from blast furnaces and toward EAF for lower emissions. For instance, the World Steel Association reports that in April 2024, the 71 nations produced 155.7 million tonnes (Mt) of crude steel, a 5.0% drop from April 2023. Demand for steel is also increasing as a result of increased investments in infrastructure development and renewable energy projects. All of this is leading to a growing demand for coal tar pitch in steel production, especially in the Asia-Pacific region, where rapid industrialization and increasing scrap-based steel production are driving steady demand growth.
• Rising demand from refractories industry: Refractories, which are used in furnaces and kilns, require coal tar pitch to bond together carbon and graphite products. Coal tar pitch is a common binder. The growth of the steel, cement, and glass manufacturing industries is associated with the demand for refractory products. Steel production is expected to grow in all regions of the Asia-Pacific region, with particularly high growth expected in China and India. From 109.137 million tons (MT) in 2019–20 to 144.299 MT in 2023–24, crude steel output increased. Production of crude steel increased 13.4% in 2023–24 compared to 127.197 MT in 2022–23. Coal tar pitch will remain an essential part of the production of both shaped and unshaped refractories, and continued development of new applications for high-temperature, high-performance materials indicates the reinforcements of market demand that align with industrial and metallurgical growth.
• Energy transition & EV battery supply chain: The use of coal tar pitch is being explored more frequently as an agent in the production of needle coke for graphite electrodes and lithium-ion battery anodes. Due to the global energy transition accelerating, the number of electric vehicles (EVs) and the development of renewable energy storage systems are expanding. By 2030, there will be 250 million EVs in the STEPS, four times as many as there were at the end of 2024, across all modes except for 2/3Ws. Over 90% of vehicles are electric, as compared to the percentage in 2024.  As governments encourage the adoption of EVs and increase funding for clean energy storage materials, the coal tar pitch industry benefits from developing and emerging applications in the energy transition and battery manufacturing supply chains.

1. Global Trade Dynamics of Steel

Crude Steel Production by Region

Source: World Steel

Top 10 Steel-Producing Countries

Source: World Steel

2. Emerging Trade Dynamics of Graphite

The explosive demand for synthetic graphite, driven by the global EV battery boom, is directly fueling the coal tar pitch (CTP) market. As new trade policies force the creation of graphite supply chains outside China, new anode plants require secure, long-term CTP contracts. These shifts demand geographically and create intense competition for high-quality "needle-grade" pitch. Consequently, CTP is transformed from an industrial commodity into a critical, strategic material for the energy transition.

Export and Import of Graphite in 2023

Source: OEC

Challenges

• Complex pricing structures: The price of coal tar pitch is influenced by various elements, including the costs of raw materials, the production techniques employed, and the market demand.  Fluctuations in the costs of upstream commodities, such as coal and oil, may lead to price volatility.  Any slowdown in the steel sector, especially in China and India, leads to reduced coal tar generation, constraining pitch supply. Furthermore, the absence of uniform pricing models across different regions adds complexity to market dynamics, posing difficulties for suppliers in sustaining stable profit margins.
• Trade barriers and export restrictions: As stated by the World Trade Organization (WTO), the imposition of export restrictions and duties by nations abundant in raw materials can disrupt market access. Recent shipping disruptions and higher freight costs have further challenged cross-border supply. For instance, the United States has contested China's export limitations on raw materials because of their effects on worldwide supply chains. These trade barriers may restrict the availability of crucial inputs necessary to produce coal tar pitch, thereby influencing global supply and pricing.