Driven by strong demand and supply constraints, price of Graphite Electrodes in China surged exponentially during the last 10 months and continues to rise.
According to Graphite Association of China, the total production of Graphite Electrode in China in 2017 will reach 550,000 tonne, registering a whopping 10% growth year-on-year. In 2018, the output is expected to be around 600,000 tonnes.
During the Jan-Nov, 2017, the combined production in China was at 508,000 tonnes which included normal power products at 114,500 tonnes, high power grade products at 166,500 tonnes and super power grade products at 227,000 tonnes.
Governed by demand and supply forces, the prices rose remarkably during the year.
Q1, 2017: the price rose to: for size(dia) 300-600mm, normal power at CNY9200-11000/mt, high power 10000-15000, super power 14500-16000.
Q2, 2017: the prices were higher at: normal 18000-27000, high 26000-45000, super 40000-68000.
Q3, 2017: prices for the super power rose significantly, while prices for the other grades were stable. By the end of Sept, the prices were: Normal 30000-90000, high 50000-140000, super 80000-200000
Q4, 2017: the prices softened by Nov’17, but again rebounded from Dec’17. The prices were: normal 30000-70000, high 65000-105000, super 80000-160000.
The price rise was governed by a slew of factors on the demand as well as the supply sides. The supply in China became tighter due to strict environmental norms dictated by the Chinese government and closure of all small factories manufacturing the electrodes from Feb’17.
Rising raw material prices also contributed towards the escalating prices of electrodes. During the year, prices of Calcined Coke rose by CNY 500/MT, Needle Coke prices went up by CNY19,500/MT and Coal Pitch prices jumped by CNY 2,900/MT.
At the same time, demand for the electrodes was robust as the downstream Electric Furnace Steel industry was making profits. Exports of electrodes from China had increased by 39.95% during the Jan-Oct’17 period to 186,800 tonne over the same period last year.
In a tentative forecast for the market in 2018, the boom in the market is expected to continue and the forecasted prices for the Normal Power, High Power and Super Power grades are expected to be at around: CNY50000-70000/MT, CNY 60000-100000/MT, and CNY 100000-160000/MT respectively on norms dictated by the Chinese government, and closure of all small factories manufacturing the electrodes from Feb’17.