Graphite Electrodes - Demand weak, prices are dropping
Demand for graphite electrodes is really low right now and there is too much overcapacity. Demand for needle coke is also low and even Phillips 66, which controls the market with a 60% market share, is lowering prices.
China has finally gotten its act together and is now making quality competitive electrodes (as opposed to the #$%$ that they used to make). China is also starting to get significant export orders, which didn't happen before when Graftech dominated the American market. Those times are over and Graftech now has strong competitors on its home turf.
Steelmakers are also figuring out ways to cut costs and use less electrodes for every ton of steel that is produced.
Even if demand takes off due to a gangbusters economy, there is so much overcapacity now that demand will be met.
Graftech will be barely profitable this quarter. Like most of the steel manufacturers, there may be some ups and downs but I dont see much upside here......