Global Synthetic Graphite Market Demand & Forecast Analysis, 2016-2032
Synthetic Graphite Market Overview
The global Synthetic Graphite market size reached a valuation of USD10.6 billion for the year 2022 and is projected to grow at a CAGR of 7.4% to reach the market size of USD 21.7 billion by the year 2032. The strong growth in the demand can be attributed to increasing synthetic graphite demand from various applications such as lithium-ion batteries, steel and refractory, and electronics.
Synthetic graphite is made by heating a mixture of petroleum coke and coal tar pitch at high temperatures. It has a high degree of crystallinity and purity, making it ideal for use in various applications that require high-quality graphite, such as electrodes, refractories, and lubricants. One of the most significant applications of synthetic graphite is in the electronics industry. Due to its excellent electrical conductivity and high thermal conductivity, it is used in the production of electronic components such as electrodes, bipolar plates, and heat sinks. Synthetic graphite is also used in the production of electrodes for electric arc furnaces, which are used in the production of steel. The electrodes made from synthetic graphite are highly durable and can withstand extreme temperatures, making them ideal for use in the steel industry. Another important application of synthetic graphite is in energy storage.
The growing demand for renewable energy sources has increased the need for energy storage solutions, and synthetic graphite is an essential material in this field. It is used in the production of lithium-ion batteries, which are widely used in electric vehicles, mobile devices, and renewable energy storage systems. The high electrical conductivity and high thermal conductivity of synthetic graphite allow for efficient energy transfer, resulting in improved battery performance. Synthetic graphite is also used in the production of refractories, which are materials that can withstand high temperatures and harsh environments. Refractories made from synthetic graphite are highly durable and can withstand temperatures of up to 3,000°C, making them ideal for use in the steel, glass, and ceramics industries. Synthetic graphite is used in the production of crucibles, which are used to melt and refine metals, and in the production of molds and other refractory components.
Synthetic Graphite Demand Analysis
The synthetic graphite market is being driven by several factors, including the increasing demand from various industries such as lithium-ion batteries, steel and refractory, and electronics. The growing concern over environmental pollution and depletion of fossil fuels has resulted in an increased demand for electric vehicles, which, in turn, has driven the demand for synthetic graphite as an anode material in lithium-ion batteries. The upsurge in the use of the electric arc furnace process for steel production is a significant contributor to the increase in demand for Synthetic Graphite.
In 2022, the largest outlet of Synthetic Graphite was in the form of electrodes, followed by carburizing material. Globally, China dominates the Synthetic Graphite market with a share of more than 54% in terms of installed capacity and 52% in terms of production. China is also a net exporter of Synthetic Graphite with exports ranging between 200-300 kilo tons/year.
Asia Pacific, on the back of China, dominates the global Synthetic Graphite market, accounting for more than 68% of the global demand. The demand for graphite is experiencing rapid growth due to its crucial role in various industries, including electric vehicles, energy storage technologies, Electric Arc Furnace Steel, and fuel cells. However, the supply of graphite is significantly dependent on China, which renders the supply chain susceptible to shipping disruptions. Currently, China possesses the largest processing capacity for both natural and synthetic graphite, accounting for 82% of natural graphite processing and over 52% of synthetic graphite production. Asia Pacific is estimated to continue its dominance in the forecast period with an annual growth rate of 7% in a span of 10 years. This can be attributed to the strong demand for electrodes and carburizing materials in major countries such as China, Japan, India, South Korea, and other APAC nations. The growing demand for lithium-ion batteries for electric vehicles is also expected to boost the demand for Synthetic Graphite in battery applications since graphite is a key mineral used as an anode material.
The Asia Pacific region is a major manufacturing hub for the electronics industry, and the demand for lithium-ion batteries is rapidly growing due to the support for electric vehicles and renewable energy storage systems. Key players such as LG Chem, Panasonic, and Contemporary Amperex Technology Co., Limited (CATL) are investing in research and development to improve battery performance, reduce costs, and expand production capacity to meet the growing demand in the Asia Pacific region and beyond. The electric arc furnace industry in the Asia Pacific region is also experiencing growth, with countries like China, Japan, and India being among the leading producers of electric arc furnace steel worldwide. The industry is investing in research and development to enhance energy efficiency, reduce carbon emissions, and improve the quality of steel produced.
Synthetic graphite plays a crucial role in the production of lithium-ion batteries, which power a wide range of devices, from smartphones to electric vehicles. The increasing popularity of lithium-ion batteries and the growth of the electric vehicle market are driving the demand for synthetic graphite. Additionally, several other factors contribute to the demand for synthetic graphite in batteries. Synthetic graphite is preferred over natural graphite due to its superior purity and consistency, making it ideal for use in high-performance batteries. It possesses a higher carbon content, a more uniform grain structure, and a lower impurity level compared to natural graphite, resulting in improved battery performance and longer battery life.
Recent developments in the Synthetic Graphite Market
The United States to increase its production capacity by adding two new facilities dedicated to serving the demand for battery applications. Novonix has already begun operations and aims to increase its capacity to 150 kilo tons by 2030, while Anovion is set to commence operations in 2026. These facilities will boost the supply of synthetic graphite and support sustainable energy solutions.
LG Chem has announced a USD 4.5 billion investment to expand its battery production capacity in Poland, with the goal of becoming one of the largest battery manufacturers in Europe. By 2025, LG Chem aims to produce up to 100 GWh of batteries annually. Tauron, a Polish energy company, is also investing in the battery industry, planning to build one of the largest 30 MW energy storage systems in northern Poland. Electro mobility Poland, a state-owned company, is involved in the production of batteries, electric motors, and other components for electric vehicles.
Sunreef Yachts, a Polish yacht manufacturer, is adopting lithium-ion batteries in its electric and hybrid yachts, offering up to 20 hours of cruising at speeds of up to 7 knots.
China holds a leading position in the production of lithium-ion batteries and the processing of minerals essential for battery production, including graphite. The CATL factory, established in 2018, is one of the world s largest battery manufacturing plants with a capacity of over 50 GWh per year. Other Chinese companies, such as BYD, are also making significant advancements in the lithium-ion battery industry, supported by the government s NEV subsidy program. Moreover, Chinese companies like EVE Energy and Qing Tao Energy Development are working on developing solid-state batteries that have the potential to revolutionize the electric vehicle industry.
India is also making investments in lithium-ion battery manufacturing facilities, with several domestic and international companies announcing plans to establish such facilities. The Indian government has launched various initiatives and schemes, including the PLI scheme, aimed at attracting investments of around USD 5.5 billion and creating 50 GWh of advanced cell manufacturing capacity over the next five years.