【Graphite Electrodes】Rising Costs Drive a Strengthening Market

【Graphite Electrodes】Rising Costs Drive a Strengthening Market

After the Spring Festival, as the market gradually resumes operations and production, steel mills have begun their procurement activities. Amid a volatile international environment and the escalation of the U.S.–Iran conflict, prices of needle coke and low-sulfur petroleum coke have continued to rise, driving graphite electrode prices to trend upward.

I. Firm Cost Support, Profit Margins of Graphite Electrodes Under Pressure

Figure 1: Comparison of Graphite Electrode Price Trends (2024–2026) (Unit: RMB/ton)

Source: Oilchem

Table 1: Price Comparison of Graphite Electrodes and Raw Materials (Unit: RMB/ton)

Source: Oilchem

As of March 12, in the graphite electrode market, ultra-high power electrodes recorded the largest increase of 600–700 RMB/ton, high-power electrodes rose by 500 RMB/ton, and regular power electrodes increased by 300 RMB/ton. On the raw material side, affected by geopolitical conflicts, costs have continued to rise. The average price of low-sulfur petroleum coke reached 4,714 RMB/ton, up 312 RMB/ton compared with the previous month, while needle coke increased by 100–245 RMB/ton. In March, downstream electric arc furnace (EAF) steel mills are expected to resume production intensively, bringing a wave of rigid restocking demand and significantly improving market activity.

II. Graphite Electrode Operating Rate Declined in February

Figure 2: Comparison of Graphite Electrode Profit and Capacity Utilization (2025–2026) (Unit: RMB/ton, %) 

Source: Oilchem

Due to the Spring Festival holiday in February, the operating rate of graphite electrode plants declined compared with January. In terms of profitability, the graphite electrode profit margin in February was -2,517 RMB/ton, down 3.16 percentage points from January. The main reason was the increase in coal tar pitch prices by 266 RMB/ton, which led to a decline in profitability.

III. Price Forecast

Currently, steel mill tenders have begun one after another. Based on the transaction prices, the increase has been relatively limited, but supplier quotations remain firm. As downstream independent EAF steel mills resume operations, demand will gradually be released. Meanwhile, affected by geopolitical conflicts, graphite electrode export volumes may decline to some extent.

Overall, the graphite electrode market is expected to show a cost-driven upward trend in the short term. Strengthening raw material prices are stimulating producers' willingness to raise prices, and overall market expectations remain relatively optimistic.

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