GrafTech International Expects Growth in Graphite Electrodes Demand
GrafTech International predicts increased adoption of electric arc furnaces and accelerating demand for petroleum needle coke, driving future growth in graphite electrodes.
GrafTech International, a leading producer of graphite electrodes used in electric arc furnaces by steelmakers, has highlighted the challenging commercial environment, impacted by global economic uncertainties. Despite this, the company remains confident about the future demand for graphite electrodes and petroleum needle coke, the key raw material for their production.
GrafTech International predicts that the steel industry's ongoing efforts to decarbonize will drive the widespread adoption of the electric arc furnace method for steelmaking. This transition is expected to boost the long-term demand for graphite electrodes, which are essential in electric arc furnaces.
Furthermore, the company anticipates a surge in demand for petroleum needle coke due to its utilization in manufacturing synthetic graphite. The growing electric vehicle (EV) market, where synthetic graphite is used in lithium-ion batteries, is a primary driver behind this increased demand.
While GrafTech International is recovering from the impact of the suspension-driven sales volume reduction in Monterrey, Mexico, they acknowledge that the soft commercial environment will continue to affect demand for graphite electrodes in the second half of 2023. Consequently, the company has revised its estimates, expecting sales volume for the full year to range between 95,000 MT and 105,000 MT, compared to the previous estimate of 100,000 MT to 115,000 MT. However, sales volume in the third quarter is projected to remain consistent with the second quarter.
In conclusion, despite the current softness in the commercial environment, GrafTech International remains optimistic about long-term growth prospects for graphite electrodes. The company expects increased adoption of electric arc furnaces in the steel industry and rising demand for petroleum needle coke in EV battery production to contribute to future success.