Renewed environmental controls in
China’s Shandong province have prompted an
increase in graphite prices, with production of high-purity
material and plus mesh sizes particularly affected by the
According to a 24 August
IM assessment, a number of graphite grades
bound for export have appreciated further.
Plus mesh size products are in
tight supply at the moment, according to local sellers, who
listed especially +50 and +80 mesh material sizes.
The shortage was prompted by a
number of factors in production areas, including drought
problems in Shandong province and a limitation to dynamite
usage during mining, which affected production.
Production was scarce also in Inner
Mongolia and, in Hebei, output decreased due to safety controls
in the area in preparation for the 2022 Winter Olympic Games
being held there.
Jixi continues to produce but
volumes are limited.
prices for graphite 85-87% C, +100 mesh, have increased to
Higher-purity 94-97% C, +100 mesh
has meanwhile surged to $800-940/tonne; +80 mesh material rose
"More expandable graphite producers
entered the market, and they need a lot of plus mesh products",
one producer in China said.
Some market participants suggested
that speculation may be having an impact.
"Speculation is another problem.
People who used to invest in bentonite or other minerals
before, now started to invest in graphite – buy as
much graphite as they can and sell it later for profit, which
is totally understandable," the producer added.
Minus mesh and
Commenting on minus mesh material
prices, one producer in southern China told
IM: "For minus mesh size products, supply is
sufficient, but prices have increased a little following the
plus mesh surge."
The increase is however contained
compared with the heights the commodity reached in 2010-2011,
he added: "Now this material is priced about Chinese renminbi
(Rmb) 3,200/tonne ex-works including VAT, for 95% C -100 mesh.
Eight years ago, this was Rmb 5,200/tonne."
Prices for 94-97% C, -100 mesh
increased slightly to $505-690/tonne, while 90% C, -100 mesh
remain at $370-400/tonne.
"Prices also surged for high purity
products like 98-99% C content, again because environmental
inspections limiting output," said one trader in north-eastern
"In fact, production is heavily
affected for any product using acid for purification and
producing waste water. It is very difficult to meet these high
environmental standards: production in Laixi and Pingdu has
Another producer in Shandong added
that, with the appointment of the new minister of China
Ministry of Environmental Protection in June, the harsh stance
of the authority against industrial pollution has intensified
"He wants to cover all provinces in
China – not just once, but several times," the
producer told IM. "Now that the inspection
team is stationed in Shandong, producers are cautious. They
don’t want any trouble, so they’d
rather stop production for a while than being fined or, worse,
"The government is requiring all
factories to switch from coal to gas but there is no deadline
yet. This will lead to more pressures on local producers," the