Demand shrinks further in January, maintenances are in order after the holiday: monthly review

ICC News: 2015 is a struggling and challenging year for needle coke industry in both production and operation. The year 2015 also witnessed global economic downturn, domestic economy growth slowdown, waning market demand, price slump and sharp declining profits.
In 2015, price of graphite electrode market in the downstream sector held weak but stable; market transaction was flat.
It has been a struggle for graphite electrode enterprises faced with pressure from both downstream and raw materials sector along with issues of payment and bank loans straining their capital chain. Right now they are basically limping forward with many operating at loss or at cost.
Entering January, 2016, Jinzhou Petrochemical, Anshan Research Institute of Thermo-Energy and Baosteel Chemical are only major domestic needle coke enterprises remaining in operation, although they are facing mounting inventory pressure.
On the price side, as of late January, mainstay price from Jinzhou petrochemical is 4,200 yuan/ton and price of green coke is 3,100 yuan/ton; mainstay price from Baosteel Chemical is 3,700 yuan/ton.
Current market price for mainstay green coke is 2,300 yuan/mt including VAT, and favorable terms are offered for large quantities.
On the import market, for petroleum needle coke, offer price from Phillips 66 is $800(HSP is $850), and that from JX Holdings is $750.
For coal-based needle coke, offer price from C-Chem is $650, and that from Mitsubishi Chemical is $650 as well.
On the downstream market front, market transaction of graphite electrode in January remained dull.
Situation at steel plants in the downstream sector is rather grim as many are operating at a loss. For steel enterprises, the capital flow is crucial lifeblood and many of them are in dire need to overcome the financing difficulty. Its severe delays in payment for graphite electrode have also dragged the latter into the abyss of financial trouble.
Some graphite electrode companies choose to reduction production and stop providing for those with poor records on payment, while striving to secure more buyers that pay better.
But for now, it is extremely hard to land steel plants with sound performance. Graphite electrode enterprises struggle to survive. With price lingering around the cost line, business sentiment is greatly affected and market performance continues to get worse.
As of now, prices for mainstay 300-600 mm graphite electrode in China are as follows: HP product is 9,000-11,000 yuan/ton, and UHP product is 12,000-16,000 yuan/ton.