Posted on 14 Aug 2020
The price of the 350mm dia graphite electrodes in East China’s Jiangsu province rebounded by Yuan 1,000/t on month to Yuan 12,300/t including the 13% VAT as of August 12 after five months of sullenness, according to Mysteel’s assessment, mainly on the supply tightness and anticipated demand recovery in the near term, according to market sources.
“Electrode producers of small dia electrodes have been losing money since the end of last year, so some of them have halted producing the small-sized products, lead to supply shortage,” a Shanghai-based market watcher commented. “When demand pick up both from home and abroad with the resumption of industrial activities, prices of electrodes with such have rebounded first,” she added.
An official from an electrode maker in East China’s Anhui province already felt the warm-up in demand. “our plant has received a lot of inquiries from overseas recently including Russia and the Middle East, and we have just completed a round of public tenders and are going to deliver the cargoes to our buyers,” he said.
A graphite electrode trader in North China’s Hebei province expressed little surprise at the latest recovery in demand.
“Small-sized graphite electrodes are much more attractive to steel mills because of its cost effectiveness and stable quality,” he said, confirming having raised the offering prices of the graphite electrodes below 350mm dia by Yuan 500-1000/t recently.
In the near term, China’s electrode producers expect both the demand and prices of graphite electrode to grow moderately as domestic steel demand will be in another hot sales season over September-October when the weather is more pleasant in most of the areas in China.
However, market participants did not expect for any substantial price recovery in the graphite electrode in the near term, as compared with the blast-furnace steel mills, China’s independent electric-arc-furnace (EAF) producers are still under great pressure of thin margins amid high costs in both scrap and power supply, as reported.
As of August 6, capacity usage among China’s 71 independent EAF steelmakers had declined to a near one-month low of 56.76%, down 1.78 percentage points on week or 0.3 percentage point on month, while that 247 Chinese BF mills grew by 0.3 percentage point on week to a new high 94.8%, Mysteel’s data showed.
Written by Lindsey Liu, liulingxian@mysteel.com
Edited by Hongmei Li, li.hongmei@mysteel.com
Source:Mysteel Global
