Graphite electrode: Nedium and long term concentration increase + demand increase under the background of double carbon

Under the double carbon background, the proportion of EAF steelmaking in China will increase

China's iron and steel industry ranks the top in annual carbon emissions, and promoting energy saving and carbon reduction in the iron and steel industry will be an important path to achieve "carbon neutralization". Juxing Graphite electrode meet Internation Quailty Standard. On December 31, 2020, the Ministry of Industry and Information Technology issued the "Guidance on Promoting the High-quality Development of Iron and Steel Industry" (draft) proposed that by 2025, China's output of EAF steel will account for more than 15% of the total output of crude steel, and strive to reach 20%, scrap steel ratio will reach 30%. 

China currently produces about 1 billion tons of crude steel and has accumulated about 15 billion tons of steel over the past 15 years. In the next 10 years, China's steel storage will continue to grow at an average annual rate of about 600 million tons. Strong steel savings resources will effectively support the continuous growth of scrap production, with a large amount of steel savings into the recovery period, depreciation scrap production will be accelerated, according to the Ministry of Industry and Information Technology estimates that the next few years scrap supply growth rate of 10%-15%.

Because of the direct use of scrap steel as raw material, the process of short-current EAF directly eliminates many pollution-causing links. According to the estimation of environmental protection experts, the direct steelmaking and ironmaking of scrap steel can be reduced 86% waste gas, 76% waste water and 97% of the waste slag, strengthening the comprehensive utilization of waste steel and increasing the proportion of EAF steelmaking will be one of the important ways to reduce carbon emissions in the iron and steel industry. At the same time, China's opening of scrap import has increased the supply of raw materials for EAF steelmaking, and the import restrictions of scrap have been reduced, which is good for EAF steel production. In the medium and long term, the market prospect of EAF steel is good.

Hasten the demand for UHP graphite electrodes

Scrap iron and steel is the only ferritic raw material that can replace iron ore in large quantities. It is a green renewable resource that can be recycled indefinitely. During the 12^th-Five-Year-Plan period, the comprehensive scrap ratio of steel-making in China was 11.3%, and during the 13^th-Five-Year-Plan period, the comprehensive scrap ratio was 18.8%, 7.5 % points higher than that in the 12^th-Five-Year-Plan period. During the 13^th_Five-Year Plan period, a total of 874 million tons of scrap iron and steel were consumed in steelmaking, saving 1.486 billion tons of iron refined powder, saving 305.9 billion kg of standard coal, reducing 1.398 billion tons of carbon dioxide and 2.62 billion tons of solid waste emissions.

Under the double carbon background, the demand for EAF steelmaking continues to rise, and the supply of scrap will be released year by year, which provides good conditions for the development of EAF steelmaking. As one of the main materials of EAF, the demand for UHP graphite electrode will continue to improve.

Medium - and long-term graphite electrode industry concentration will improve

Graphite electrode belongs to high energy consumption industry, power consumption is large, environmental protection problems are serious, double carbon lower limit power factor and raw material prices rise to raise the average cost of the industry, industry overcapacity, some small and medium-sized enterprises under the cost pressure of loss, so gradually eliminated.

With the continuous reduction of the number of small and medium-sized enterprises, the profitability of large enterprises with strong comprehensive strength, relatively high production technology level and strong cost control ability will be improved, and the market share will continue to expand through mergers and acquisitions, and the medium and long term industry concentration will further improve, to view more graphite market news contact us.