The graphite electrode (GE) prices in China are steadily moving up amid improved downstream demand. The increased production by steel mills in October has actively stimulated the consumption of the graphite electrode. In fact, China produced 92.6 mn t of crude steel in Sep’20 up by 11% against September last year.
The price for 450mm HP grade electrodes is currently assessed to be at RMB 13,000-14,200/t ($1,940 – 2,120/t) whereas that for 600mm it is around RMB 18,000 – 20,500/t ($2,685 – 2,980/t).
In past two years, as the proportion of electric arc furnace in steelmaking increased, the demand for ultra-high power graphite electrodes in steel mills also increased.
However, the investment in the electrode industry have also recorded a significant surge, causing the production of graphite electrodes to rise and making demand-supply imbalance (triggered in 2017) to vanish.
While COVID-induced poor demand from both domestic and export market adversely impacted the Chinese GE prices in initial months of ongoing year, the resumption of industrial activities and opening of economies have led to increased steel demand providing some support to GE prices in past two weeks.
In case of raw material, the needle coke market has been operating steadily and companies’ ex-factory quotations have not changed much. The transaction prices are often adjusted according to the order volume. The price for oil and coke-based needle coke are currently being assessed at RMB 5,500-7,000/t ($745-1,100/t).
Outlook ahead
Towards the year-end, the demand for electrodes usually becomes limited as steel mills focuses on books closure rather than increasing production resulting which prices are likely to remain stable. Even needle coke prices are also likely to remain relatively stable in upcoming days.
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