Smithers Apex recently spoke with Dr. John Quanci of SunCoke to gain his perspective on the Met Coke World Summit and the Coke market.
Smithers Apex: Why is the Met Coke World Summit important for the industry?
Dr. John Quanci: It’s the one time each year that the coal and coking industries come together for an exchange of ideas. It’s also a good discussion of new industry trends and what the near-future holds for coke. I like the mix of industry and outside experts too, for an objective assessment of how things are really going. The Met Coke Summit is also the only coke-centric conference in the U.S. that offers a truly open Q&A.
Smithers Apex: What are the biggest challenges facing the industry right now?
Dr. John Quanci: Surviving the downturn in the steel market is still the biggest challenge so many of us are focused on controlling what we can, like managing costs and operating our plants as efficiently as possible. A secondary challenge, but still an important one, is sourcing the right coals for our customers in the wake of mine closures and other financial difficulties that many key suppliers are facing.
Smithers Apex: What opportunities seem most important?
Dr. John Quanci: I think the biggest question still out there is “has the steel market already hit bottom?” There are some encouraging indicators, like the price increases of HRC and CRC in 2016. If it has bottomed out, then we need to be ready when the upturn hits. At the moment we are nearing a balance of coke and steel mill utilization, but if steel production ramps up quickly the coke industry will have to respond. There are also a lot of talented individuals in the coke, coal and steel industries who lost their jobs in the downturn and there may be an opportunity to bring them back in.
Smithers Apex: What are the most important factors influencing the coke market today?
Dr. John Quanci: The balance of coke production and steel mill utilization is certainly important, and that balance can be supported in part by logistics. Our coke plants and transportation options give us the flexibility to move our coke to different customer locations.
Smithers Apex: Without making any “forward-looking statements,” what factors do you see as important for the next five-ten years in coke?
Dr. John Quanci: I think it comes down to a handful of key questions: Will we be ready for the upturn in the steel market? Does China successfully rein in overcapacity in steel and coke? And will India finally achieve the growth rates typically forecasted but consistently not achieved?
Smithers Apex: What thing do you see influence the industry most that didn’t exist (five/ten/twenty) years ago?
Dr. John Quanci: I don’t believe importing coke has ever been seriously considered because of the associated costs and degradation, along with increasing needs for high-quality coke. But if a rapid increase in domestic steel production leads to a short-term coke shortage, importing might be on the table. Today’s EAFs perform better too, which is changing the production mix. BFs hold the competitive advantage when production volume is high and commodity inputs are relatively low. Also, the continuing uncertainty of ever more stringent environmental regulations.
Smithers Apex: What are you looking forward to most about the Met Coke World Summit?
Dr. John Quanci: In addition to the networking and programming, I always look forward to Dr. Hardarshan Valia’s presentations.