San Francisco, 25 November 2024: The Report Graphite Market Size, Share & Trends Analysis Report By Form (Natural, Synthetic), By Application (Electrodes, Battery Production), By Region, And Segment Forecasts, 2024 - 2030

The global graphite market size is anticipated to reach USD 21.07 billion by 2030 and is projected to grow at a CAGR of 3.7% from 2024 to 2030, according to a new report by Grand View Research, Inc. It is anticipated to be primarily driven by demand for electrodes and refractories within the crude steel industry. Furthermore, the increasing demand for electrification in the automotive industry has given rise to the requirement for graphite as anode material for electric vehicle (EV) battery production.

With increasing emphasis on green steel, producers are making the shift towards investing in better production technology and overhauling of parts and machinery. This has necessitated increased demand for electrodes in Electric Arc Furnaces (EAFs) and refractories for furnace lining material. For instance, in June 2024, Essar Group announced that they would invest USD 4 billion to construct a green steel plant in Ras Al-Khair Saudi Arabia as part of the company’s transition to green energy.

Investments in the EV battery value chain is a key trend that is driving graphite demand. For instance, in April 2023, Hyundai and SK On announced plans to set up a joint venture to build a USD 5 billion battery plant in Georgia, U.S. These projects have been announced against the backdrop of the U.S. Bipartisan Infrastructure Law and Inflation Reduction Act. Hence, such government initiatives are anticipated to boost market demand over the forecast period.

The demand for graphite is anticipated to be driven by its usage in electrodes and refractories. The rise in the usage of electric arc furnaces (EAFs) owing to the global transition towards green steel is the main contributor for market growth. Moreover, graphite is consumed in producing crucibles, molds, and ladles to pour molten metal in the steel making process.

The easing of U.S. inflation levels towards the end of 2023 has resulted in the revival of government spending through the bipartisan Infrastructure Investment and Jobs Act. Also increasing private spending on manufacturing and the consumer markets has boosted investor confidence in the construction industry. With the requirement of electrodes in EAFs and refractories in the steel industry, graphite demand is anticipated to receive a boost over the next few years.

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Rising construction expenditure is a key growth driver for the global market. For instance, in the U.S., according to the U.S. Census Bureau, construction spending increased by 7% in 2023 compared to 2022. It was 10% higher in April 2024 as compared to the previous year. The surge in spending is attributed to the rise in single-family housing and a decline in mortgage rates.

Graphite Market Report Highlights

• Based on form, the synthetic graphite segment led the market with the largest revenue share of 67.6% in 2023. Synthetic graphite is extensively used in the production of graphite electrodes and as anodic material in EV batteries. The graphite segment is anticipated to witness at the fastest CAGR of 4.4% over the forecast period
• Asia Pacific dominated the market with the largest revenue share of 54.2% in 2023, owing to its demand from the steel and EV industries
• In June 2024, Madagascar-based Etablissements Gallois announced its overseas expansion plans to construct a new anodic material graphite manufacturing plant in Malaysia. This will be made operational by its subsidiary Gallois New Energy Materials in collaboration with SEDC Energy. The greenfield would be located in Samaluju Industrial Park, Bintulu for an investment of USD 1.5 billion. In the first phase, the plant is scheduled to be on stream in 2026 and produce 50ktpy of spherical graphite and 50ktpy of synthetic graphite. By 2028 the company is aiming to produce 150ktpy of spherical graphite and 150ktpy of synthetic graphite. By 2030, capacity would be ramped up to 200ktpy of spherical graphite and 200ktpy of synthetic graphite. The plan is in line with the company’s efforts to move the battery value chain out of China

The increasing investments in electric vehicle battery manufacturing across the world is identified to be a key opportunity for the global market. Graphite is used as the anodic material in EV batteries. The year 2023 witnessed many automotive manufacturers such as Tesla, Honda, Volkswagen, and Maruti Suzuki investing in Electric Vehicle (EV)  plants. For instance, in November 2023, Tesla signed an agreement with the Government of India to set up an EV plant in two years. Meanwhile, it is currently looking at sourcing auto parts and batteries from the country.

Graphite Market Report Scope

The geopolitical situation is a key restraining factor to the global market. With graphite’s application in lithium ion batteries, geopolitics is playing an important role in shaping the future of battery supply chains. Various measures have been taken by countries across the world to shift away from Chinese dependency. For instance, the U.S.’ Inflation Reduction Act stipulates that sourcing raw material and components from Foreign Entities of Concern such as China, Iran, Russia, and North Korea will result in the prohibition of a home-manufactured EV to receive tax credits. As a result, automotive OEMs have started shifting its raw material procurement out of China, and to other countries in Africa. The restriction in availability of raw material from able sources is viewed as a key restraint to the market.