SunCoke’s coke plant in Brazil
SunCoke Energy (SXC) started its coke making plant in Victoria, Brazil, in 2007. The plant has an annual coke making capacity of 1.7 million tons. It’s the company’s largest coke making facility in the world. With 28.5 million tons of steel production in 2013, Brazil ranks among the top ten steel producers in the world. Moreover, iron ore is available in abundance in Brazil, making it an attractive location for coke and steelmaking. Brazil also exports pig iron, an intermediate product in the steelmaking process that’s made by heating iron ore with coke. The plant supplies coke to ArcelorMittal Brazil (MT).
SunCoke in India
In March 2013, SunCoke formed a joint venture with Visa Steel Limited, an Indian steel producer, to run a coke making plant in India with a capacity of 440,000 tons a year. India is the fourth largest steel producing country in the world after China, Japan, and the United States. With the outlook for India’s economic growth improving, steel production is also expected to rise. As a result, India is a key market for SunCoke. With a slowing China, met coal producers (KOL) around the world, including Peabody Energy (BTU), are looking at India for an incremental demand for met coal.
SunCoke supplies 25% of US coke demand
SunCoke Energy (SXC) operates as an independent coke producer. According to company estimates, it fulfills a 25% demand for coke in the United States and Canada. Integrated steel producers, those who produce coke, iron, steel, and steel products, account for 63% of the coke market. DTE Energy Company (DTE) accounts for 8% of the coke market, while other coke producers account for the remaining 4%. Who are SunCoke’s major customers? Let’s check that out in the next part.