[SMM Analysis] Production Capacity Increases in May, Graphitization Prices Slightly Decrease

In May, the average price of anode graphitization was 9,420 yuan/mt, down 0.74% MoM. Last month, as south-west China entered the normal water period, electricity prices decreased, and some local OEM graphite plants resumed production. The supply of the industry increased, competition intensified, and the order prices for resumed producers were generally low, leading to a slight decline in graphitization prices. The total graphitization capacity in May was 303,900 mt; it is expected that the total graphitization capacity in June will be 308,500 mt. Looking ahead, in June, the increase in graphitization OEM orders is expected to be limited, with many OEM plants mainly executing existing orders. Along with the release of new capacity and the resumption of old capacity, the industry's overall effective capacity will increase, competition will be intense, and prices will be under pressure. It is expected that graphitization prices will stabilize, with a possibility of a slight decline.