MARKET REVIEW COCONUT SHELL CHARCOAL

April 2018

            Amid an increasing trend of the price, world demand of activated carbon is expected to strengthen in 2017. The trend was following a positive growth in the last decade. Global imports of activated carbon in 2006 was 0.55 million MT and jumped to 0.84 million MT in 2016 which shows an increase by 54%. The average annual growth of world imports of activated carbon in the last decade was 4.9%. USA and Japan were the main importing countries of activated carbon in the global market. The two countries shares 19% of the product from the global market during 2016.

          Japan import of activated carbon was 86,181 MT in 2017 which increased by 7.9% opposed to that of previous year’s volume. Meanwhile, US import of activated carbon derived from coconut shell charcoal showed an increasing trend in the last 4 years. In 2014, US import of the product was 18.835 MT and jumped to 43,767 MT in 2015. The positive trend continued in 2016 when import of the activated carbon reached 45,358 MT. According to the latest data, US import of the product has gone up in 2017. In 2017, 91,289 MT of activated carbon was shipped to the US. During the period, India was the main supplier for the commodity accounting for 37.26% of the total US import. Other exporting countries were Sri Lanka, Philippines, Japan and Indonesia contributing 24.6%, 15.7%, 7.2% and 5.9% of the total.

         India, Philippine, Sri Lanka and Indonesia are the major producing countries of shell charcoal based activated carbon. In the period of January-December 2017, India exported 93,868 MT of activated carbon valued at US$140.6 million, an increase by 21.6% compared to the previous period. During the period, the market destinations of activated carbon from India were ranging from Africa to America. There were more than 100 countries which imported activated carbon from India. USA was the largest importing country accounting for 24,226 MT.  Other major markets for India’s activated carbon were UK, Sri Lanka, UK, South Korea, Netherlands, Germany, Russia, China, and South Africa. Export volume to those countries varies from 3,103 MT to 5,252 MT. It is worth noting that during the period of January-December 2016, export of activated carbon from India reached 79,618 MT spreading to 96 countries worldwide.

Other major exporting country was Philippines. Export volume of the commodity from the Philippines in 2017 showed an increase. In 2017, the Philippines shipped 70,353 MT of activated carbon to international market which was 14.5% higher compared to the corresponding period of previous year i.e. 60,162 MT. The product was shipped to 51 various destinations. Germany, Japan and USA were the main destinations of activated carbon from the Philippines which absorbed more than 49% of total export volume of activated carbon from the Philippines.

             Sri Lanka, another main producing country, for activated carbon (AC) from coconut shell charcoal (CSC) also experienced an increase in demand for the product. In the period of January-December 2017, the accumulated export volume of coconut shell based activated carbon from Sri Lanka continued to rise following a positive growth in the last few years. In the period, total export volume of the product was 39,591 MT. The export was 13% higher than the previous year volume for the same period i.e. 34,987 MT. Export of Sri Lanka’s coconut shell based activated carbon went to more than 65 countries worldwide. In the period more than 32% exports of activated carbon from Sri Lanka were shipped to Europe. Germany, Turkey, Estonia, Netherland, and Sweden were the main destinations. America absorbed more than 31.7% of export of Sri Lankan activated carbon and dominated by USA. More than 95% of Sri Lankan activated carbon that was sent to America headed to USA. For Asian countries, the exports of activated carbon from Sri Lanka were mainly shipped to China and Japan accounting for 49% of total import of the region.

            Unlike other major producing countries, Indonesian export of activated carbon in 2016 has been indicating a further decrease in 2017 following an easing trend in 2016. In the period of January-December 2017, export volume of the product dwindled from 22,634 MT in 2016 to 20,077 MT in 2017. Japan was the main destination of activated carbon from Indonesia. USA absorbed 4,958 MT or 25% of activated carbon from Indonesia during the period. Japan, Taiwan, China and Sri Lanka were other important destinations of the product. Indonesia generated an export earning of the commodity trade in the observed period at US$31.65 million.

             The shell product showed an increasing trend in all producing countries including Indonesia, Philippines, Sri Lanka, and India. Price of coconut shell charcoal in Indonesia was US$412/MT in January 2017 and reached US$470/MT in July reached us$509/MT in March 2018. Meanwhile, in Philippine price of the product was US$340/MT and ended up at US$456/MT in December 2017. In Sri Lanka, price of the product in January 2017 was US$356/MT and reached US$491/MT in December 2017. The increasing trend reflected a high demand of the charcoal. The increasing demand for coconut shell based products such as activated carbon, briquette, sisha, and fuel for boiler has pushed the demand of the charcoal.

As the price of shell charcoal increasing, activated carbon manufacturers started raising their prices. Price of shell charcoal based activated carbon showed a rising trend in the second half 2017 after a relatively stable flow in the first half. In Indonesia, price of activated carbon started to go up in July 2017 after a relatively stable trend since 2016. The export price of activated carbon from Indonesia was ranging from US$ 1,395/MT to US$ 1,714/MT with average of US$ 1,572/MT for the period of January-December 2017. Meanwhile, in Sri Lanka, though it showed a fluctuating movement, the price revealed an improving trend in the second half of 2017. In May 2017, the price was US$1,879/MT and gradually increased to US$2,102/MT in December 2017.