Graphite Electrodes: This week, prices for ultra-high-power and high-power graphite electrodes saw a slight increase. The crude oil and steel markets provided some support to electrode pricing. Additionally, production restrictions imposed in various regions have limited the release of electrode output, boosting manufacturers’ confidence and prompting them to raise their quoted prices slightly. Currently, most mainstream electrode manufacturers maintain relatively stable production operations; however, a few companies have slightly reduced output due to the impact of the pandemic. In the areas surrounding Beijing, most enterprises are currently shut down. On the cost side, after the Spring Festival, new orders for petroleum coke and needle coke have risen, while coal tar pitch prices remain at high levels, providing continued support to electrode pricing. On the supply side, electrode manufacturers in Hebei and Henan face production constraints, and graphite carbonization capacity utilization in Inner Mongolia remains low. Coupled with the impact of the Winter Olympics and environmental inspections, the tight supply situation in the electrode market has further intensified compared to earlier periods. Downstream procurement demand remains weak, with small-scale steel mills resuming production slowly, and large-scale steel mills affected by production restrictions related to the Winter Olympics, resulting in generally subdued demand.

Carbon-increasing agent: This week, market prices for carbon-increasing agents edged slightly higher. Prices for coal-based carbon-increasing agents remained stable with minor adjustments, while the price center of oil-based carbon-increasing agents shifted upward. Rising raw material costs provided support for the increase in carbon-increasing agent prices. Following the holiday, petroleum coke prices have been raised consecutively, and under the impact of production restrictions imposed for the Winter Olympics, the supply of coke has become relatively tight, affecting both the cost and market supply of oil-based carbon-increasing agents. Additionally, carbon-increasing agent manufacturers themselves have been affected by production restrictions, further tightening the supply of these products. On the coal-based side, ongoing environmental inspections in the Ningxia region continue to keep the supply of calcined coal-based carbon-increasing agents tight. Most enterprises are now focusing on fulfilling long-term contracts, and market conditions after the Spring Festival have largely followed the trend seen earlier in the year. Market transactions remain relatively slow, as downstream industries are still in the initial stages of resuming operations and thus have low demand for carbon-increasing agents, primarily drawing down previously accumulated inventories. However, as more downstream companies resume work and low-priced supplies become increasingly scarce, buyers’ stockpiling intentions may rise, which bodes well for future market conditions for carbon-increasing agents.

Needle coke: In the first week following the holiday, needle coke prices also saw an increase. The rise in upstream raw material costs and production restrictions imposed ahead of the Winter Olympics provided impetus for needle coke producers to adjust their prices upward. Under the influence of heightened geopolitical tensions, international crude oil prices have risen, driving up domestic oil market conditions. The high price of low-sulfur oil slurry provides robust support for the cost of oil-based needle coke. Although the market price of coal tar pitch remains temporarily stable, it currently stays at a high level, continuing to underpin the cost of coal-based needle coke. On the supply side, production in major producing regions has been constrained by the Winter Olympics’ production restrictions. Currently, Yida is operating at 50% capacity, while Jingyang is completely shut down. Several other needle coke producers are also idled due to rising costs or production limitations. Overall, supply has significantly declined compared to the previous period, and resource tightness has become particularly pronounced. Downstream transaction performance has been somewhat lackluster; after the holiday, few new orders have entered the market, and most downstream companies are also affected by production restrictions. However, the demand for electrodes and negative electrodes remains strong and steady, prompting needle coke producers to maintain stable production based on earlier orders. As a result, overall supply falls short of demand.

Negative electrode materials: This week, the negative electrode material market continued its relatively strong trend. Graphitization capacity remains tight, and the supply in the negative electrode market continues to be in short supply. Affected by the Winter Olympics, graphite processing activities in regions such as Hebei, Henan, Shandong, and Inner Mongolia have all been restricted. Coupled with the diversion of resources toward graphite electrodes and carbon additives, the availability of graphitized materials for negative electrodes has become even tighter. On the raw materials side, conditions remain strong: flake graphite prices remain stable at high levels, and most enterprises in major producing areas are still shut down for maintenance and upgrades, keeping flake graphite prices firm. After the Spring Festival, needle coke and petroleum coke prices have risen, and overall market supply remains tight, which is favorable for reducing negative electrode costs. Downstream battery manufacturers are operating at a good pace, maintaining robust demand for negative electrode materials. All negative electrode manufacturers have full order books and are actively ramping up production.