IRON and STEEL
SteelMint has heard from its market sources that after falling continuously over past few months, the electrodes prices in China have stabilized this week. However, the market continues to remain weak with tepid downstream demand and high inventories with the producers.
The competition is still fierce in the domestic market among the GE manufacturers, the prices are still at lower level and the procurement enthusiasm of the steel mills continues to be negative. The small steel producers have been shut down in China due to reasons including environmental protection measures whereas the situation of large enterprises is not very good.
The price of UHP grade electrodes of size 450mm are in the range of RMB 13,000 – 15,000/MT (USD 1,800 – 2,100/MT) whereas that of 600mm are in the range of RMB 42,000 – 53,000/MT (USD 5,900 – 7,500/MT). However, in case of 700mm UHP grade GE, the supply crunch continues and its prices remain firm at RMB 74,000 – 78,000/MT (USD 10,450 – 11,000/MT). The price of 450mm electrodes of HP grade are heard to be in the range of RMB 13,000 – 14,000/MT (USD 1,800 – 1,900/MT).
With the upcoming winter season starting from next month of October, the GE prices in China are expected to fall further due to production cuts by steel mills as a part of environmental protection measures.
GE companies opt for production cuts
Amid weak demand, falling prices and excess production, electrodes producers in China are opting for production cuts. One such company is Jiaozhou Zhonzhou Carbon Co. Ltd which is a GE producer with a capacity of 50,000 tonnes. The company has slashed its production just half to 25,000 for 2019. The company’s average monthly production this year slipped from 4,000 tonnes to 2,000 tonnes. In the first eight months of 2019, the company produced about 20,000 tonnes of GE in total and is currently focusing on production of UHP 600mm and 700mm UHP grade electrodes.
Apart from this, a small sized graphite electrode producer, Heoilonjiang Changsheng Carbon Co. Ltd with a capacity of 30,000 tonnes has cut its production by 33% since July this year. In August month they produced 1,000 tonnes of electrodes, down from 1,500 tonnes in July. For September month they plan to produce about 1,000 tonnes of electrodes and will shut down completely in the month of November during the winter season.