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Hotspot: The situation in Russia and Ukraine is conducive to China’s graphite electrode exports

With the further tension between Russia and Ukraine, the sanctions imposed on Russia by Europe and the United States and other countries have intensified, and some large Russian industrial enterprises (such as Severstal Steel) have also announced that they will stop supplying to the EU.  Affected by this, global commodity prices have generally risen recently, especially for some products closely related to Russia (such as aluminum, hot-rolled coils, coal, etc.)

1. Import and export of graphite electrodes in Russia

Russia is a net importer of graphite electrodes. The annual import volume of graphite electrodes is about 40,000 tons, of which more than half of the resources come from China, and the rest come from India, France and Spain. But at the same time, Russia also has nearly 20,000 tons of graphite electrodes for export every year, mainly to the United States, the European Union, Belarus, Kazakhstan and other countries. Since most of the electric arc furnaces in the above-mentioned countries are above 150 tons, the graphite electrodes exported by Russia are also mainly large-scale ultra-high-power electrodes.

In terms of production, the main domestic electrode manufacturer in Russia is Energoprom Group, which has graphite electrode factories in Novocherkassk,Novosibirsk, and Chelyabinsk. The annual production capacity of graphite electrodes is about 60,000 tons, and the actual output is 30,000-40,000 tons per year. In addition, Russia’s fourth largest oil company is also planning to build new needle coke and graphite electrode projects.

From the perspective of demand, at present, more than half of the ultra-high-power electrodes in Russia are imported, ordinary power is mainly domestic supply, and high-power basically accounts for half.

2. Driving the export of graphite electrodes in China

It is understood that after the war between Russia and Ukraine, due to the double impact of the increase in production costs and the interruption of Russian exports, the quotation of large-scale ultra-high-power electrodes in some European markets has reached about 5,500 US dollars / ton.  Looking at the global market, except for the small expansion of the production capacity of Indian graphite electrode manufacturers in recent years, the production capacity is basically relatively stable, so it is a good opportunity for Chinese graphite electrode manufacturers.  On the one hand, it can increase exports to EU countries, and large-scale ultra-high-power electrodes can fill the original Russian market share of nearly 15,000-20,000 tons. The main competitors may be the United States and Japan;  In the reduction of EU countries’ exports to Russia, the main competitor may be India.

Overall, it is expected that this geopolitical conflict may increase my country’s graphite electrode exports by 15,000-20,000 tons per year.

Post time: Mar-08-2022