Graphite prices in North America continued on a downward trajectory, shaped by a mix of market uncertainties and geopolitical influences. The region remained reliant on imports from key suppliers such as China, Madagascar, and Mozambique, with global production shifts disrupting established supply chains. While U.S. government investments in alternative graphite sources and domestic manufacturing facilities highlighted a strategic move toward supply chain diversification, progress was hindered by persistent challenges in scaling local production. By the end of the quarter, graphite flake prices stood at USD 1013/MT CFR Houston.

Demand across the United States was uneven. The electric vehicle (EV) sector—traditionally a major consumer of graphite—saw fluctuating demand, as automakers adjusted production in response to global supply chain constraints. The construction sector experienced seasonal weakness, with activity slowing in multi-family housing projects amid high mortgage rates and low housing inventory. On the other hand, industrial sectors such as steel production and lubricants demonstrated relative stability, though overall market sentiment remained cautious. Geopolitical concerns surrounding China’s dominance in graphite supply and ongoing shifts in trade policies further contributed to market pressure.

Despite these headwinds, the U.S. market made notable strides in securing long-term supply agreements, offering a foundation for potential recovery in 2025 as economic conditions improve and new domestic manufacturing initiatives advance.

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The European graphite market continued to experience a steady decline in prices, with Germany at the forefront of this downward trend. This drop was largely attributed to weak demand and evolving supply conditions across the region. The quarter began with a modest 0.7% decrease in prices, influenced by sufficient domestic availability, falling freight costs, and additional supply inflows from Madagascar. However, any optimism was short-lived as demand remained underwhelming, particularly in key industries such as steel and batteries. Battery electric vehicle (BEV) registrations declined by 5% year-over-year, underscoring reduced momentum in one of graphite's most important end-use sectors.

Germany’s economy struggled throughout the quarter, with continued stagnation in manufacturing and no clear signs of recovery. Demand across major sectors, including construction and EV production, remained consistently low, prompting further reductions in graphite prices. A significant 22% drop in BEV registrations during the quarter contributed to a year-to-date decline of 26%, reflecting a marked slowdown in the region's green mobility transition. Factory input costs also trended lower, mirroring the broader downturn in industrial activity and reflecting the uncertainty surrounding political and economic developments in the region. Moreover, a gradual industry shift toward synthetic graphite further eroded demand for natural graphite, compounding market challenges.

Annual EV sales fell sharply by 27.4%, while the construction sector faced persistent weakness amid tightening credit conditions and project delays. These factors led to an oversupply of graphite in the market, adding further downward pressure on prices and creating a sluggish trading environment. By the end of the quarter, prices for graphite flakes (94%, -100 mesh) had fallen to USD 797 per metric ton Ex Hamburg, highlighting a difficult close to the year for the European graphite industry.

The graphite market across the Asia-Pacific region saw a 3% decline in prices, shaped by softening demand and changing supply-side dynamics. Production levels throughout the region remained consistent, with key contributions from major suppliers such as Madagascar and Brazil, complemented by ongoing improvements in processing technologies. Despite this stable output, demand signals were mixed across core sectors like construction and automotive, with buyers exhibiting cautious purchasing behavior due to prevailing economic uncertainties and an emphasis on maintaining lean inventories.

The battery industry continued to play a central role in driving graphite consumption; however, growth was tempered as manufacturers prioritized inventory optimization rather than aggressive restocking. In China, the world’s largest graphite producer, prices came under persistent downward pressure, ending the quarter at USD 656 per metric ton for graphite flakes (94%, -100 mesh) FOB Shanghai. Market sentiment was weighed down by strategic production cutbacks as several producers scaled back operations in response to soft demand and seasonal market fluctuations.

The construction industry in the region showed further signs of contraction, while the automotive sector faced a slowdown in the adoption of new energy vehicles, limiting graphite usage. Adding to these challenges were heightened export restrictions and ongoing geopolitical tensions, which led to reduced international shipments and created uncertainty around trade flows. Domestically, consumption remained uneven, with some sectors more resilient than others. Nonetheless, the region maintained steady production levels, and there was a sense of cautious optimism about a potential rebound in 2025, driven by recovery in downstream industries and improved global demand. Overall, the graphite market in APAC during the quarter reflected a nuanced blend of regional supply steadiness and variable consumption trends, shaped by both internal and external pressures.