GrafTech expects modest year-over-year improvement in sales in FY24

The company said, “As we enter 2024, we expect demand for graphite electrodes in the near term will remain weak, reflecting persistent softness in the commercial environment as steel industry production remains constrained by global economic uncertainty. However, we anticipate a modest year-over-year improvement in our sales volume for 2024, most notably in the Q1 of 2024, as the Q1 of 2023 was significantly impacted by the temporary suspension of our Monterrey, Mexico facility. Reflecting industry-wide softness in graphite electrode demand, challenging pricing dynamics have persisted in most regions. As a result, we are being selective in the commercial opportunities we choose to pursue. In addition, we are taking the previously described actions to further reduce our cost structure and optimize our manufacturing footprint. These actions, combined with the benefit of reduced market pricing for certain raw materials and energy, as well as the anticipated improvement in our sales and production volume levels, are expected to result in a significant year-over-year decline in our cash cost of goods sold per MT. Longer term, we remain confident that the steel industry’s accelerating efforts to decarbonize will lead to increased adoption of the electric arc furnace method of steelmaking, driving long-term demand growth for graphite electrodes. We also anticipate the demand for petroleum needle coke, the key raw material we use to produce graphite electrodes, to accelerate driven by its utilization in producing synthetic graphite for use in lithium-ion batteries for the growing electric vehicle market. We believe that the near-term actions we are taking, supported by an industry-leading position and our sustainable competitive advantages, including our substantial vertical integration into petroleum needle coke via our Seadrift facility, will optimally position GrafTech to benefit from that long-term growth.”