COVID-induced demand slump has taken a toll on graphite electrodes (GE) demand globally. China which is a key GE exporter has failed to achieve better export demand even after lowered export offers.
The average export price of Chinese GE during Jan-Jul’20 stood at $2,630/t against $6,790/t in same period last year whereas Chinese electrodes exports stood at 0.18 mn t during the said period, contracting by 22% y-o-y basis.
“Although market demand for steel has improved globally, the demand for electrodes has not increased significantly as the EAF mills already have enough stock which they are utilising and we are just waiting for export demand to pick-up in the last quarter of 2020”, quoted a GE trader based in China.
In terms of domestic demand, Graphite electrodes (GE) prices in China continue to remain stable, market transactions have been average and GE mills are not very enthusiastic about increasing production.
The ex-factory price of UHP grade GE of size 600mm is averaging around RMB 18,000/t ($2,650/t) including tax and that of HP power 450mm is around RMB 13,250/t ($1,940/t). The overall market is sluggish and chances of any significant uptick in prices seem meagre.
From the perspective of raw materials, needle coke, the market demand is weak and the enthusiasm for purchase is low. The ex-factory price of oil-based needle coke RMB 5800-7000/t ($850 – 1,030/t) including tax, and the price of coal-based needle coke is RMB 5500-6300/t ($810 – 925/t).
Outlook
In the short term, the electrode market dynamics is weak and chances of a price rise is low. In terms of needle coke also any upward movement in prices seems unlikely in the near term.
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