From mine to market: creating a
vertically integrated supply chain for
high-specification graphite products

The Market

The Market

The graphite market has been in recovery since 2017. Like many commodities, China dominates its supply and demand, so mine closures across China have helped to propel graphite prices.

The price of graphite is based on direct seller and buyer negotiations rather than an internationally recognised price index. It’s price highly dependent on a number of different factors such as purity, crystallinity, size, downstream processing and desired end-use.

Generally, graphite with high purity, crystallinity and larger sized flakes – such as McIntosh graphite – achieve the highest prices.

Additional Key Facts relevant to Hexagon’s marketing strategy

  • Scale – 2.44mtpa of graphite produced globally in 2017*:
    • 1.55 mtpa of synthetic graphite; and
    • 0.90 mtpa of natural (mined) graphite.
  • 76% of all graphite is from China
  • Natural graphite market comprises:
    • 59 mtpa flake (66%)
    • 0.30 mtpa amorphous (34%)
    • .01 mtpa vein-flake (<1%)
  • Natural graphite sources by country:
    • China – 0.63 mtpa (44:56 flake:amorphous, with flake now almost entirely fine and small sized flake.
    • Brazil – 0.01mtpa, followed by India, Canada and Ukraine
  • Synthetic graphite:
    • precursor material is a by product from petroleum refining (PetCoke + other varieties)
    • produced by “graphitisation process”– involves heating in an Acheson Furnace for 3 weeks at 2,500 to 2,8000C; Synthetic graphite quality is related to time, temperature and feedstock.
  • Natural flake graphite is already flaky and crystalline; “graphitisation” has already occurred over the course of millions of years under the influence of temperature and pressure in the Earth’s crust.
  • Synthetic graphite is expensive but of a consistent quality which is critical for high end applications such as batteries and electrodes – but it is harder and less conductive than natural graphite and does not “expand”.
    • Batteries – 0.4 to 0.5mtpa of graphite goes into batteries (Forecast* growth rate of 20% pa-EV & ESS)
      • Natural graphite comprises between 50 to 30% of the battery – mainly in the anode and;
      • the other 50 to 70% is synthetic graphite.
    • Electrodes – 1.1 mtpa of synthetic graphite is used for electrodes in electric arc furnaces (EAF), (Forecast* growth rate of 16-18% pa).
  • Demand for graphite in batteries and certain industrial uses such as EAF steel production have strong growth dynamics over next 10 years.