SHANGHAI, Jan 5 - The prices of natural graphite have declined slightly recently amid weak demand, according to SMM data.
The power market: New energy vehicle subsidies are coming to an end, and the stimulus for consumers has weakened. This, coupled with the current spread of COVID-19 pandemic and the impact of the economic environment, kept end-user consumption poor. Inventories at battery factories have accumulated, so most of the plants are destocking.
Digital market: Conventional consumer electronics such as mobile phones and computers lack new products, and the service life is generally long. Since the beginning of 2022, terminal demand has continued to be weak. Some drones, electronic cigarettes and wearable devices contributed to a relatively small proportion of consumption at present. The overall consumption remained subdued.
Energy storage market: Although the future demand for energy storage is promising, the use of negative electrode accounts for only a small proportion. At present, the support of demand for negative electrode still comes from new energy vehicles, which is weak. The supply of natural graphite is relatively stable, with limited new capacity. The supply tends to exceed the demand.
From the perspective of cost, prices of spherical graphite are stable, therefore the cost of natural graphite anode is stable. The processing of natural graphite is relatively simple. The direct raw material spherical graphite accounts for around 60-70% of the cost of low-end natural graphite anodes. The production capacity of graphite is relatively sufficient, and the downstream demand is weak, stabilising the prices of spherical graphite. Moreover, the downstream battery manufacturers have been keen to lower their costs. As such, the prices of natural graphite anodes have dropped slightly recently.
