SteelMint has heard from its market sources that Japan’s contract prices for graphite electrode which are currently trending in the range of 1,100,000 – 1,300,000 yen per tonne (USD 9,775 – 11,155/MT) are estimated to increase to 1,400,000 – 1,500,000 yen per tonne (USD 12,445 – 13,330/MT) in Oct to Dec quarter of 2018.
In Jan-Apr’18 quarter, Japan’s graphite electrode prices hovered in the range of 900,000 – 1,100,000 yen per tonne (USD 8,000 – 9,000/MT).
The GE prices in Japan have risen by three times in current year against last year’s prices. The graphite electrode prices across the globe have soared dramatically in the second half of 2017 amid tight supply from China due to the closure of its polluting GE units as a part of supply-side reforms.
In case of raw materials, the price of needle coke in the country has increased by 30% in the month of July and is also likely to increase further in the October quarter. The increase in needle coke prices in Japan is also triggered by tight supply (exports) of the same in China due to strict environmental regulations by the Chinese government.
There exist a price difference in Japan’s domestic electrode prices and international prices resulting which domestic electrode manufacturers have considered price increase of GE from the October quarter.
The steel demand in Japan via EAF route is quite high thus requiring stable procurement of GE for steel production. The increase in country’s GE cost will also lead to rise in country’s domestic steel prices in the coming months.
China’s GE prices fall marginally W-o-W basis
The GE prices in China have registered a slight fall of RMB 3,000 – 5,000/MT (USD 450 -750/MT) this week. The prevailing prices for 450mm UHP graphite electrode are being heard in the range of RMB 70,000-75,000/MT (USD 10,468 – 11,275/MT), 600mm UHP graphite electrode are at RMB 105,000-125,000/MT (USD 15,785 – 18,790/MT) and that of 700mm UHP graphite electrode are RMB 140,000-160,000/MT (20,940 – 23,930/MT).
As per the market sources, the prices of UHP grade GE below 550mm are quite fluctuating at present whereas that above 550mm are relatively stable amid rising needle coke prices in China.
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