Domestic graphite electrode price is expected to be strong after the Spring Festival

Summary:

With the logistics outage, pre-holiday stocking is nearing the end, the Spring Festival holiday is coming, the market has entered the state of closure. At present, the domestic graphite electrode price trend is strong, so how will the domestic graphite electrode market adjust after the Lunar New Year? Let's make a brief analysis from the following points:

I. Market review

Take φ500 ultra high power graphite electrode in Jiangsu area as an example, as of January 25, 2022, the quotation of ultra high power graphite electrode is 21500 yuan/ton, the quotation of high power graphite electrode is 20500 yuan/ton, and the quotation of ordinary power graphite electrode is 20000 yuan/ton, which increases by 1000-2000 yuan/ton on average compared with the beginning of the month. The overall performance of the domestic graphite electrode market before and after the Spring Festival in 2021 is stronger, with an average increase of 500 yuan/ton. However, the pattern of jiangsu graphite electrode oscillating upward from January 2022 is expected to maintain a rising trend after the festival.

Ⅱ. Supply situation

After entering in January, the domestic environmental protection policy of restricting output tighter, mid, hebei, henan, Inner Mongolia, shanxi, shandong and other places energy-consuming polluting enterprises have entered into a state of production, the production included some graphite electrode head enterprises, graphitization influence on supply and demand, and most of the production has been halted, graphitization cost is early January rose 1000 yuan/ton, Graphite electrode manufacturers show that some specifications are not complete, the transaction atmosphere is light. In terms of manufacturers' inventory, after the Spring Festival of 2022, due to high raw material prices and rising energy prices, the capacity release of major graphite electrode manufacturers may be limited, and the capacity release of graphite electrode suppliers in some regions will be weaker than the level of the same period last year.

Ⅲ. Demand situation

(1) Steel mills

From the start of domestic blast furnaces and electric arc furnaces, affected by the environmental protection production limit policy during the Winter Olympics, the start of blast furnaces and electric arc furnaces is significantly lower than the same period of previous years, with a drop of about 15%. In terms of profit of finished materials, during the Spring Festival, electric furnace profit showed a negative growth state, and the profit of electric arc furnace decreased significantly, which was negative for the price of large specification graphite electrode in China, while the profit of blast furnace was higher than expected in previous years, or formed a positive support for the price of small and medium-sized specification graphite electrode.

(2) Silicon metal

At present, the silicon metal market transaction is slightly weak, the market activity is not high, and the downstream stockpiling cycle is shortened. As silicon prices hit the cost line, traders wait-and-see mood, no increase in purchasing intentions. From the perspective of silicon metal start-up, due to the dry season in the southern market, only a few large factories have started operation; due to the weak demand in the northern market, the market start-up has further declined; silicon metal market has poor demand for graphite electrode, and the overall recovery may be in the second quarter.

(3) Resistant material

Affected by the Winter Olympics environmental protection production limit policy, refractory industry as a whole starts poorly. In terms of raw materials, the operating rate of brown corundum smelting furnace is 47.2%, white corundum smelting furnace 51.21%, silicon carbide smelting furnace 39.19%, and with the start of the Winter Olympics, some regions may be forced to stop production, the market recovery may be at the end of February, so there is no positive support for graphite electrode demand in the refractory material market after the Spring Festival.

Iv. Forecast after the Spring Festival

At present, the domestic graphite electrode market has entered the situation of "stable supply and weak demand", and the graphite electrode in various regions has also entered the stage of exhaustion. In terms of raw materials, low sulfur coke increased by 1200 yuan/ton in the last month, and the cost continued to enter a high level, forcing the price of graphite electrode to rise. At present, the domestic graphite electrode price is relatively high in the same period in recent years. In the first half of 2022, the improvement range of the demand side will be significantly stronger than that of the supply side, and some specifications may enter a tight equilibrium state. In general, after the Spring Festival of 2022, the domestic graphite electrode price or strong operation , reading more graphite new from us.