Graphite electrode market analysis

Supply side: raw material prices continue to rise.

Graphite electrodes are mainly made of petroleum coke and needle coke, coal tar is used as a binder, and is calcined, compounded, kneaded, pressed, calcined, graphitized, and machined to release electrical energy in the form of an arc in an electric arc furnace The conductors that heat and melt the furnace charge can be divided into ordinary power graphite electrodes, high power graphite electrodes, and ultra high power graphite electrodes according to their quality indicators.

Affected by de-capacity, since the beginning of this year, the upstream raw material market of the carbon industry has set off a wave of price increases. Since October last year, the prices of major raw materials for the production of carbon such as petroleum coke, coal pitch, calcined back coke, and needle coke have risen along the way, and the increase has continued to set new records. Compared with November of last year alone, in March this year, the price of asphalt increased by more than 110%; the price of petroleum coke increased by about 70%; the price of imported needle coke increased by 66%.

When talking about the price increase in the raw material market, the person in charge of Fangda’s carbon procurement department used three “swells” to describe it. Although he and the procurement staff have been paying close attention to the information on the price changes of raw materials, on the basis of strengthening market prejudice, he has adopted measures such as purchasing at low prices and increasing inventory to deal with price increases and ensure production, but the rising trend of raw materials The magnitude is still far beyond industry expectations.

Supply and demand change, the price has not been discussed. In the supply-side market, price increases seem to have become the mainstream voice, which has almost become the main profit model of various raw material manufacturers in the near future, which has further increased the market risks and operating costs of downstream carbon companies.

Demand side: demand continues unabated

The continuous recovery of the iron and steel industry is undoubtedly good news for graphite electrode manufacturers, especially after the induction medium frequency furnace and high frequency furnace used for ground steel are upgraded with electric arc furnaces, the demand for graphite electrodes will continue to increase.

It is understood that the current trend of strict banning of “strip steel” is unabated. According to relevant requirements, the country ’s task of eliminating production capacity and cleaning up “strip steel” must be completed by June 30 this year, which has led to a greater blow. The ban on “strip steel” will help large steel mills to acquire more scrap steel, and the main use of electric furnaces for scrap steelmaking. Some manufacturers in the industry believe that the ban on “ground steel” has increased the demand for electric furnace replacement and the use of graphite electrodes has increased. Under normal circumstances, domestic demand is 500,000 tons per year. At present, the actual market demand is about 650,000 to 700,000 tons. gap.

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