East China's graphite electrodes prices dip to 38-month low

Mysteel's national benchmark price for 600mm ultra-high-power (UHP) graphite electrodes in East China Jiangsu province declined to a 38-month low as of June 4 to reach Yuan 18,000/tonne ($253.5/t) including the 13% VAT. Thursday's result meant prices had lost another Yuan 3,000/t from one month earlier, Mysteel's data shows.

Blamed for the tumble was tepid purchasing demand among domestic electric-arc-furnace (EAF) mills and an oversupply among electrode producers, according to market sources.

"More and more electrode plants are rushing to sell goods by lowering their offer prices, hoping to seize market share," an electrode market watcher in North China's Tangshan province commented, adding that quality of graphite electrode products is a rising concern. "We've noticed that several electrode plants tried to cut their production costs by sacrificing the quality of electrodes," she added.

An official with an electrode maker in East China's Anhui province admitted that business is tough. "Current electrode prices are below our production costs so we would rather stop sales than lose money," he told Mysteel Global. "At the same time, although our plant has received a lot of inquiries from overseas buyers recently, actual transactions have been rare."

In April alone, China's exports of graphite electrodes fell 25.26% on month or 3.24% on year to 28,500 tonnes, according to data disclosed by Iccsino, a leading platform for online information and trade relating to China's graphite carbon industry.

However, while more electrode producers plan to temporarily halt production amid the thinning profits, at the same time domestic EAF steelmakers remain keen to maintain production recently, a market watcher observed, predicting that the imbalance between electrode supply and demand seems likely to ease in the near term.

This article has been exchanged under article exchange agreement between Mysteel Global and SteelMint