GE Export Deal concluded at Surprisingly Low Price in Middle-East

The graphite electrodes prices globally are on a free-fall for over the past one year amid excess supply and poor downstream demand. As per SteelMint's analysis, the electrode prices have plunged by almost 67% y-o-y basis (ex-China). This includes both HP as well as UHP grades.

With increased trade barriers, poor demand and cut-throat competition between the GE manufacturers, SteelMint has heard from its market sources that a steel mill based in Middle East, after a few rounds of negations have agreed to procure UHP grade electrodes of size 700mm in the price range of USD 4,350 – 4,370/MT. The purchase contract is being signed for the period of almost one year.

Although there is no official confirmation on the same, reliable sources have informed that low-price trade deals have been offered by the Russian and Chinese manufacturers.

The new prices discovered will come as a shock to the industry participants. “We have adjusted to the price plunge over the past few months but such a low price was highly unexpected. The new price has completely thrown us off guard and we really wonder how will that company which has offered such a low price will cover its cost of production," said a senior official of India-based electrodes manufacturer on the condition of anonymity.

The current prices of high quality needle coke, a key raw material for electrodes is in the range of USD 3,400 – 6,000/MT. Although, a fall is being anticipated for needle coke prices for January quarter, a major plunge is unlikely given its parallel demand from electric vehicles battery segment.

Globally, the offer price for the UHP grade electrodes of size 600mm by Japanese and American manufacturers are anywhere in the range of USD 6,500 – 7,000/MT. Whereas Indians and Chinese are offering the same in the range of USD 5,000-5,500/MT. U.S. sanctions on Iran which was a major export destination for Chinese and Indian GE suppliers was a major setback for them. However, Chinese suppliers are believed to re-route their electrodes to Iran via few countries like Turkey, Dubai, Oman, and Malaysia, while Indians have completely stopped their exports to Iran.