Graphite India: How will Resonac’s plant closures impact the global graphite market?

Mumbai: Graphite electrode manufacturers HEG and Graphite India surged on Monday in weak trading following news reports that Japan’s Resonac Holdings will shut down its China and Malaysia plants. Resonac is a major producer of graphite electrodes, used for electric arc furnace (EAF) steelmaking.

Shares of Graphite India jumped 15.1% to close at ₹560. HEG shares advanced 7.7% to end at ₹528.3.

“Resonac’s Chinese and Malaysian plants account for about one-third of the company’s total graphite production,” said Manish Chowdhury, head of research at Stoxbox. “While the global supply of graphite will go down post this move, demand remains intact, in tandem with demand for metals and other industrial usages, which can now be fulfilled by Indian companies.”

Chowdhury expects prices of graphite electrodes to firm up due to a demand-supply imbalance.

Graphite electrodes are mainly used in steelmaking and by chemical firms. China is the world’s leading producer of graphite, used for military applications and the making of electric vehicle batteries.

While HEG derives almost 70% of its revenues from exports, Graphite India earns around 35% of its revenues from exports.Shares of Graphite India are down 1.4% this year, whereas HEG shares have remained flat in 2025 so far. The benchmark NIfty 500 is up 1.7% in this period.Recently, brokerage B&K Securities assigned a ‘Buy’ rating on Graphite India, with a price target of ₹718, citing an upward trend in graphite electrode (GE) prices.

This implies 28.2% upside from Monday’s close.