Anti-dumping investigation could increase costs for European steelmakers

A disagreement between Chinese exporters of synthetic graphite electrodes and European manufacturers could lead to higher production costs for European steelmakers using electric arc furnaces (EAFs), market research analysts report.

On 17 February, the European Commission began an anti-dumping investigation into synthetic graphite electrodes originating from China, leading to a sudden increase in electrode purchases and shipments before any potential duties are put in place.

The complaint had been made earlier in 2020 by graphite electrode producers Graphite Cova (German subsidiary of Graphite India Limited), Tokai Erftcarbon (German subsidiary of Tokai Carbon, Japan), and Showa Denko Carbon Holding (Japanese company with electrode plants in Germany, Spain and Austria).

According to market researcher Roskill, if the investigation results in restrictions being applied to electrode imports from China, this could lead to higher costs for European steelmakers.

Steel mills operating EAFs require the use of synthetic graphite electrodes and cannot substitute with other types of lower performance carbon electrodes.

'Around 41% of European (EU27+UK) crude steel is produced via EAF, which allows the greater use of recycled scrap steel products. The investigation comes at a time when global demand for steel is rising, recovering from the effects of COVID-19 though 2020,' Roskill says in a recent analysis.

'Roskill forecasts European EAF steel production to increase by 7.0% in 2021, versus a worldwide increase of 6.3%, led mainly by China.'