The Chinese domestic price of graphite electrodes is in a rising trend currently. The Deputy Secretary General Liu Ronghua from China Non-Metallic Materials Industry Association graphite Specialized Committee said: “ Due to shortage of supply side, graphite prices or continuous phenomenon. " “ the main reasons are the impact of environmental protection factors, many enterprises stop production, coupled with the electrode production cycle is relatively long, at least 3 months or more, so the market is in short supply, some enterprises have money but will not take delivery.". Before the sale of goods, the money can not be received, and now is the seller's market, it must have the dvance money."
This year, affected by environmental inspectors, the graphite electrode production enterprises which are from Hebei, Shandong and Henan Province are in limited production and production stopped situation, the Agency predicted the annual output of 500 thousand tons or less; at the same time, the reform of the steel which are made from iron and steel scrap and melted by induction furnace leads to the demand of arc furnace increased , expected annual demand may reach 600 thousand tons of graphite electrodes.
The electric arc furnace replace frequency furnace leads to incremental demand: since the end of last year banned furnace events across the country, at the beginning of this year , the government clearly completely banned all iron and steel scrap steel production capacity before the end of June , a corresponding increase in demand to replace the electric arc furnace.
Up to now, some parts of Henan graphite electrode enterprises are still limited production 20%, Shandong Enterprises Limited production of 30%, the national environmental factors involving production stopped or production reduced capacity of 20-30 tons. Follow up with the environmental group gradually entered the local supervision ,the enterprises resume production is still in large resistance in short-term.
The raw material and production factors further exacerbated the tight supply situation: the graphite electrode production cycle is at least 4 months or more, the superposition of stocking cycle, it probably need about half a year, although since April this year, prices began to rise sharply, but the short term is difficult to volume.