I. Overview of Prebaked Anodes

Prebaked anodes are carbon products and constitute a major raw material indispensable in the electrolytic aluminum production process. Classified according to their manufacturing process, prebaked anodes are a type of carbon product—specifically, a fine-grained subclass of carbon anodes. From an application perspective, prebaked anodes are used exclusively as anode materials in the electrolytic cells during aluminum smelting; they serve both as conductors and participate in electrochemical reactions, thereby undergoing consumption. The quality of prebaked anodes significantly influences the quality of primary aluminum produced.

Classification of Carbon Materials

II. Pre-baked Anode Industry Chain

The pre-baked anode industry chain is a sub-chain of the primary aluminum production industry chain. Its upstream raw materials mainly include petroleum coke and coal tar pitch. Producing one ton of pre-baked anodes requires 1.2 tons of petroleum coke and 0.16 tons of coal tar pitch. Meanwhile, its sole downstream demand comes from electrolytic aluminum producers; each ton of electrolytic aluminum produced consumes approximately 0.5 tons of pre-baked anodes. Therefore, the demand for pre-baked anodes is closely linked to the output of downstream electrolytic aluminum production. The electrolytic aluminum industry is the only downstream application sector for pre-baked anodes.

Pre-baked anode industry chain

III. Current Supply and Demand Situation in the Prebaked Anode Industry

1. Supply situation

Looking at the production capacity of China’s pre-baked anode industry, the growth rate has gradually slowed down, primarily due to stricter industry standards and enhanced environmental protection policies, which have prompted many small-scale manufacturers to gradually exit the market. According to statistics, as of the end of October 2021, the nation’s total pre-baked anode production capacity reached 28.616 million tons per year, representing a slight increase of 600,000 tons from the 28.016 million tons at the end of 2020—a growth rate of 2.14%.

From the perspective of industry production volume, statistics show that from January to October 2021, the output of prebaked anodes reached 17.5337 million tons, representing a year-on-year increase of 6.79%. From January to October, the capacity utilization rate for prebaked anodes was 61.4%, slightly higher than the 59.1% recorded in 2020.

M10 China Prebaked Anode Production Capacity and Output from 2016 to 2021

From the perspective of the geographical distribution of production capacity, prebaked anodes are relatively concentrated. According to statistics, the major regions where they are concentrated are East China, Northwest China, Central China, and North China, accounting for a combined 87%. Looking at specific provinces, Shandong (31%), Henan (12%), Xinjiang (12%), Inner Mongolia (8%), and Gansu (5%) have relatively high shares of production capacity. The high proportion of prebaked anodes in Shandong and Henan is mainly due to their close alignment with previously established domestic electrolytic aluminum production capacities.

Distribution of China’s Pre-baked Anode Production Capacity by Province in 2021 (M10)

From the perspective of production capacity structure, as of the end of October, among the total prebaked anode capacity of 28.616 million tons per year, the capacity of in-house prebaked anode facilities built by primary aluminum enterprises themselves amounted to approximately 11.761 million tons per year (accounting for 41%), while the capacity of commercially operated prebaked anode enterprises specializing in the production of prebaked anodes reached about 16.855 million tons per year (accounting for 59%).

2021 M10 China Pre-baked Anode Segment Capacity Structure Situation

2. Demand Situation

Based on a consumption rate of 0.42 tons of prebaked anodes per ton of electrolytic aluminum, the domestic market size for prebaked anodes in 2020 was approximately 15.57 million tons. As of October 2021, China’s total installed capacity for electrolytic aluminum stood at 42.8 million tons per year, with an operating capacity of 38.4 million tons per year, resulting in a capacity utilization rate of 89.65%. From January to October 2021, China’s cumulative output of electrolytic aluminum reached 32.36 million tons, corresponding to a prebaked anode consumption volume of approximately 13.59 million tons.

2015-2021 M10 China’s Primary Aluminum Production and Pre-baked Anode Demand

IV. Current Status of China’s Prebaked Anode Imports and Exports

Due to China’s abundant resources of coal pitch and petroleum coke, the raw material costs for prebaked anode production are relatively low, giving prebaked anode products a certain price advantage in the international market. Moreover, as the world’s largest exporter of prebaked anodes, China’s export volume far exceeds its import volume. The customs code for “prebaked anodes (carbon electrodes for electrolysis)” is “85451900.” According to statistics, from January to October 2021, China’s export volume of prebaked anodes was 1.436 million tons, while its import volume was 806.34 tons.

Import and Export Volume of M10 Prebaked Anodes in China, 2015–2021

From the perspective of import and export values, according to statistics, from January to October 2021, China’s exports of prebaked anodes totaled US$1.048 billion, while its imports amounted to US$44.5099 million.

Import and Export Value of M10 Prebaked Anodes in China, 2015–2021

From the perspective of import and export destination shares, China’s products are primarily exported to countries such as Malaysia, the United Arab Emirates, and Russia. According to statistics, from January to October 2021, the distribution of China’s export destinations was as follows: the United Arab Emirates—268,300 tons, accounting for 19%; Russia—178,700 tons, accounting for 12%; Malaysia—423,100 tons, accounting for 30%; Canada—272,100 tons, accounting for 19%; and other countries and regions accounting for 20%.

2021 M10 China Pre-baked Anode Export Destination Share Situation

Looking at the share of export volumes from each province within China, statistics show that from January to October 2021, Shandong accounted for the largest share of exports, reaching 80%.

Proportion of M10 China Pre-baked Anode Export Volumes by Province in 2021

V. Future Development Trends in the Prebaked Anode Industry

China is the world’s leading producer of prebaked anodes; however, its overall production capacity exhibits a slight surplus and regional imbalances between supply and demand. From the perspectives of scaled production, capital utilization efficiency, and production and management costs, the market share of commercial prebaked anodes is expected to continue rising. The industry’s market concentration remains relatively low, and there are still many small-scale prebaked anode manufacturers that rely on outdated equipment and technology and lack environmental protection facilities. Due to subsequent shortages in funding, technology, and production capacity, these smaller firms will be forced to withdraw from the competition or undergo mergers and restructuring, causing market shares to gradually concentrate among the leading enterprises.

Future Development Trends: High-quality prebaked anodes are expected to benefit from the increasing proportion of high-current electrolytic cells. As technology advances and there is growing demand for higher unit production rates in primary aluminum smelting, Chinese aluminum companies are gradually increasing their adoption of high-current-capacity technologies, thereby raising the quality requirements for prebaked anodes. The increase in electrolytic cell current capacity necessitates a corresponding enlargement of prebaked anode dimensions, placing higher demands on the size of forming equipment used to produce prebaked anodes, as well as on the homogeneity within these anodes and the precision of the baking process. On the other hand, the rise in current density means that each unit area of the prebaked anode must withstand greater current flow, which in turn imposes even stricter requirements on the anode’s quality—specifically, parameters such as resistivity, air reactivity, and CO2 reactivity.