Vung Tau Materials Joint Stock Company

Chinese GE market price chart during Jan. to May 2017, and priceincreasementtrendency in the second half year of 2017 and the first half year of 2018
A. Chinese GE market price chart during Jan. to May 2017

Remark: See above chart, the price of UHP550 increased by 100% in May compared to the price in early Jan.2017.

Remark: See above chart, the price of HP350/400 increased by 83% approx. in May compared to the price in early Jan.2017.

Price increasementtrendency in the second half year of 2017 and the first half year of 2018
According to the analysis and prediction of graphite electrode industry association of China , GE price in the second half year will be increased by 20% approx. compared to the price in May, and the price in the first half year of 2008 will be increased further by 5% compared to the price in the second half year of 2017.For example, for UHP550 GE,
the EXW price in May is Euro.6000/MT, the EXW price in the second half year of 2017 is round Euro.7200/MT, the EXW price in the first half year of 2018 is round Euro.7500/MT.

2. GE output in last 10 years & Estimated output in 2017 in China

Remark: GE output in 2016 in China is 500,000mt, while in 2017 the output will be declined to 300,000mt.

In China, because carbon companies have been losing money in recent years, the impact of environmental tensions andfinancial strains, in 2017, some small and medium-sized carbon companies have been reproducing, cutting production and even closing production capacity.The urban air pollution prevention and control work in March 2017 has caused serious threats to companies in Henan province, Hebeiprovince and Shanxi province, causing most carbon companies to suspend production. Influenced by China's environmental protection policy, all induction furnaces closed, while electric furnace steelmaking production increased of 50million tons, corresponding GE demand increased 200,000 tons. In this case China's domestic GE production has seriously can't satisfy the
demand of GE. The serious shortage is the main problem of the current graphite electrode.

3. Output of China top 10 GE producers in 2016 and 2017

Remark: The total GE output for above top 10 GE producers will take 75% share in total Chinese GE output.

In 2016 the output for above top 10 is 374,000tons, while in 2017 the data will be round 264,000tons, output declined by 30%.

4. Global GE output in 2016 and 2017

Remark: Global GE output in 2016 is 1.3 million tons (China output 500,000tons, Abroad 800,000tons).

In 2017 output declined to 0.8 million tons (China output 300,000tons, Abroad 500,000t. Foreign carbon companies, which have been losing money for years, shut down 5-7 carbon plants in the last three years, causing a decline of about 300, 000 tons.