Graphite Electrode Market Size, Trends, Demand, Analysis, Share ...

Graphite Electrode Market Size

The global graphite electrode market size was valued at USD 14.30 billion in  and is projected to reach from USD 14.89 billion in  to USD 20.54 billion by , growing at a CAGR of 4.1% during the forecast period (-).

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The global graphite electrode market is being driven by the growing usage of batteries in various applications, which are known to improve battery performance when combined with graphite electrodes. A shift toward electric arc furnaces from conventional blast furnaces, owing to their advantages, is expected to boost market growth.

Large, cylindrical graphite electrodes are typically manufactured with coal tar pitch, premium petroleum needle coke, and some additives. They transform electrical energy from the power source into heat for melting scrap metal. As a result of graphite's high thermal conductivity and low electrical resistance, these electrodes can produce heat as hot as 1,600 degrees Celsius. Graphite Electrode is primarily utilized in Electric Arc Furnaces (EAF) and Blast Oxygen Furnaces (BOF) to produce steel and melt ferrous alloys. These electrodes produce high-quality goods with high electrical conductivity, withstand high heat dissipation, and exhibit exceptional mechanical strength.

Graphite Electrode Market Growth Factors

Rising demand to enhance battery performance

The graphite electrode market is driven by the demand for graphite in numerous applications, lithium-ion batteries being one of the most significant. Lithium-ion batteries are extensively utilized in electric vehicles (EVs), portable electronics, and renewable energy storage systems. Therefore, advancements or enhancements in lithium-ion battery technology have the potential to significantly impact the graphite electrode industry.

In this context, substituting 15% of graphite with Ionisil in a water-based CMC/SBR binder system yields electrodes with a stable capacity of 740 mAh/g greater than three times that of a pure graphite anode. This increased capacity significantly improves the performance of lithium-ion batteries, allowing for longer battery life and greater energy storage capabilities. Thus, the trend mentioned above drives the expansion of the global graphite electrode market.

Growing preference for eaf (electric arc furnaces)

EAFs have become a popular alternative to conventional blast furnaces due to their energy efficiency, adaptability, and reduced environmental impact. EAFs are ideal for the production of specialty steels and the recycling of scrap metal. Consequently, the global adoption of EAFs has increased significantly. This increase in EAF steel production has directly increased the demand for graphite electrodes, essential to the EAF steelmaking process. For instance, India has been concentrating on increasing its steel production capacity and has set an ambitious goal of 300 million tons by . India is actively adopting EAF technology to achieve this objective, significantly increasing demand for graphite electrodes.

Market Restraining Factors

Soaring prices of needle coke

Needle coke is a specialty-grade petroleum coke with good quality for making electrodes. Needle coke is a primary material for graphite electrodes in an electric furnace. Coal-based needle coke is produced from coal tar, and compared to petroleum-based needle coke, they have excellent physical properties such as a low coefficient of thermal expansion and low electric resistance, along with less spalling and less breakage.

China is a major graphite electrode-producing and exporting country, and its price trends affect global graphite electrode prices. Prices for high-power and ultra-high-power electrodes were high in because of the higher prices of needle coke. Uncertainty in crude oil prices has led to price volatility of needle coke as it is a derivative of crude oil. Such high price trends of needle coke are acting as a restraint to the graphite electrode market.

Market Opportunities

Rising availability of steel scrap in China

Approximately 40% of the world's steel production is derived from recycled steel scrap. The employment of steel scrap results in a reduction of carbon dioxide (CO2) emissions by 58%. Scrap consumption in China is increasing rapidly, owing to the shutdown of sub-standard steel capacities after realizing the hazardous effects of carbon dioxide emissions caused by induction furnaces. This movement has helped China shift toward the surging use of electric arc furnaces (EAF) for steel production. According to official figures, the country imported 552,892 tons of steel scrap in , an increase of 1,938% from .

China is expected to increase its steel scrap usage by 23% to 320 million tons by to meet its climate commitments. With China rapidly trying to increase its steel production through EAFs, which require graphite electrodes, the market for graphite electrodes is expected to rise in the country in the coming years. Using EAF would promote steel scrap over virgin ore. The increase in EAF production is projected to increase steel scrap usage in the country and is likely to generate tremendous opportunities for the growth of the graphite electrode market.