As reported by SteelOrbis on April 11, the Chinese graphite electrode market may face oversupply by 2020, but given the commissioning of new EAFs in China, Chinese graphite electrode consumption is expected to increase over the next two years, therefore continuing to support high prices globally in 2018 and 2019.
In 2017, China produced between 520,000-590,000 mt (depending on reporting source) of graphite electrodes, out of which around 202,000 mt was exported (34-39 percent) and the rest was utilized for domestic consumption.
However, the ratio of domestic consumption versus exports of graphite electrodes is forecast to increase in 2018 with higher scrap usage by EAFs, thereby increasing domestic consumption to 500,000-530,000 mt in 2018. With a total estimated production of 600,000-610,000 mt of graphite electrodes in 2018, only 12 to 18 percent is expected to reach the export market. In 2019, 12-15 percent of the 650,000 mt production is expected to reach the export market. By 2020, some expect domestic production of 720,000 mt to process the potential 150 million mt of scrap used by Chinese EAF’s with only 12-15 percent of the graphite production reaching the export market.