Why will the graphite price soar
2013-06-11 23:22:47
Record levels expected; amorphous graphite’s supply from China still a concern
Graphite prices have continued to rise, with some grades of medium and large flakes reaching or crossing the
threshold of $2,000/tonne, market sources reported to IM.
“We have seen price increases for material from China. The increase is mainly due to seasonal effect as most of
the mines are still closed and the demand is still high,” a Europe-based trader explained.
“There is now a more strict control from the custom authority and the minimum export prices for calculating the
export tax have been adjusted,” he added.
Crystalline graphite, large flake, 94-97% C, +80 mesh, FCL, CIF European port, increased to $2,000-2,500/tonne
from a previous range of $1,800-2500/tonne.
Graphite, crystalline, medium flake, FCL, CIF European port, jumped to$1,500-1,900/tonne from $1,000-
1,400/tonne to for 85-87% C (+100-80mesh) and to1,800-2,300/tonne from $1,600-2,000/tonne for 94-97% C
(+100-80 mesh).
Meanwhile, fine crystalline graphite, CIF European, increased to $1,400-1,800/tonne from $950-1,400/tonne for
90%C, -100 mesh, and to 1,750-2,150/tonne from $1,500-1,850/tonne for 94-97%C, -100 mesh.
“Prices for natural flake graphite from China have increased significantly during H2 2010,” another European
trader confirmed to IM, pointing out the discrepancy of graphite requirement and graphite production during that
period as the driving force to explain this rise.
“Economy recovered worldwide, the lithium-ion battery industry requested more and more quantity of graphite
and production was not increasing at the same pace,” he said.
Towards $3,000/tonne?
What will happen during the next few months is not easy to predict and will mainly depend on the
supply/demand situation in China.
“Prices were stagnant in 2010. Now it seems over the last 12-15 months, prices are going up – probably the
tendency is to continue this trend,” a Europe-based trader commented.
“There are rumours that the price rises will cease over the next few months as Chinese producers return in May,
but I don’t think this is the case – Chinese companies are basically already back in the market,” he added.
Some producers have called for even greater price increases, with one trader commenting that large flake
graphite, European port, could climb to $3,000/tonne
Amorphous graphite prices
Prices for amorphous graphite also increased significantly, with amorphous powder (80-85% C, Chinese, FCL,
CIF European port) increasing from $430-450/tonne to $600-800/tonne.All graphite mines from the main mining
area in Hunan province in China have been closed for about nine months now, constraining supply.
The Hunan province, usually producing 200,000 tpa or more amorphous graphite a year, has been very strictly
controlled since September 2010. Since then, the market was supplied from mining stocks, which get fewer and
fewer.
“As a consequence, prices increased by more than 100 % during the past nine months and some grades like 90%
carbon are virtually unavailable in the market,” a European trader explained to IM.
“Most of the stocks are completely sold so there is currently very little supply. With what small amount of supply
that is left suppliers are asking for very high prices,” a processing company told IM.
The question is now when the Hunan province’s mines will re-open, and no one in the industry seems to have the
answer. It is therefore quite likely that amorphous graphite prices will continue to climb.
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