A Game of the Supply and Demand, Graphite Electrode Enterprises Continue to Rise in Price

Recently, China's graphite electrode price has risen by 1000 yuan/ton. By December 2, 2022, China's graphite electrode mainstream price (diameter 300-600mm): Regular power was 21,500-23,500 yuan/ton; High power was 21,500-24,500 yuan/ton; Ultra high power was 23,000-27,500 yuan/ton; Ultra high power 700mm was 30,000-31,000 yuan/ton.

The main reason is that due to cost pressure and insufficient profits, graphite electrode enterprises are very enthusiastic about price rise. In addition to the current shrinking supply side of the graphite electrode market, some enterprises are still controlling and reducing production. Therefore, under the dual support of supply and cost, graphite electrode enterprises have pushed up the price. However, due to the poor demand of downstream steel plants, there was no transaction after the implementation of the new price. The specific analysis is as follows:

1. Insufficient profits, graphite electrode enterprises obviously hope the price will rise

At present, the price of low sulfur petroleum coke in Fushun and Daqing upstream raw materials of graphite electrode is 6320 yuan/ton, down 9.42% from last week. However, due to the long production cycle of graphite electrode, the price decline did not have a significant impact. Coal tar pitch average market price is about 7923 yuan/ton, and needle coke average market price is about 11,708 yuan/ton, indicating that the raw material prices of graphite electrode are still high. Theoretically, the current production cost of graphite electrode market is about 21,000-22,000 yuan/ton. Compared with the actual transaction price of the current graphite electrode market, the overall profit space is insufficient, and graphite electrode enterprises are still looking to reverse the loss situation.

Graphite electrode upstream raw material price index (unit: yuan/ton)

2. Graphite electrode market production is insufficient, enterprise quotation is firm.

It is reported that the overall operating rate of graphite electrode market is still insufficient. At the end of November, the overall operating rate was less than 40%. On the one hand, the epidemic control in some regions was still relatively strict, transport vehicles were hard to find, resulting in increased freight costs; On the other hand, the epidemic containment management was still carried out in some areas according to the region, and the production of enterprises was also restricted. Affected by environmental protection inspection, graphite electrode enterprises production in Handan, Hebei was limited.

3. The demand is flat, graphite electrode price is under pressure.

Steel plants side: Electric furnace steelmaking plant suffers from loss and lacks operation, so the demand for graphite electrode is relatively small. Long process steel plants mainly purchase on demand. The rising price of graphite electrodes may stimulate steel plants to replenish their inventories.

Export side: According to the personnel of the graphite electrode enterprise, compared with last year, the export orders decreased significantly, and there was pessimism about the future market.

 Future forecast

At present, graphite electrode enterprises operating rate is insufficient, and the cost side is still at a high level, but the downstream market demand is weak, and the procurement is mainly on demand. This time, graphite electrode enterprises strongly pushed up prices, hoping to reverse the loss situation. However, due to downstream demand, there is still no obvious improvement limit, and the new price has just begun to be implemented. After the price was pushed up, no transaction was made. Therefore, in general, graphite electrode price will gradually rise. Graphite electrode market analysis, welcome to further communication with us.