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More graphite on the table but market softens

by Oliver Probert created Oct 30, 2014 11:45 AM

As a bevy of juniors announce further developments in the promising graphite sector, some experts have questioned the hype.

  
More graphite on the table but market softens

Graphite has potential uses in multiple technological fields. Photo: US Government

World demand for graphite is only about 1mt at the moment, but scientists believe the unique form of carbon could, down the road, become one of the most widely-utilised minerals in the technology landscape.

The potential use of graphite in batteries, steelmaking, machinery and electrodes, as well as the development of graphene – dubbed the world’s strongest and most malleable substance by some – could see further demand from the 3D printing sector, as well as use in medicine, electronics, desalination, molecular science, energy storage and production, and dozens of other industries.

African graphite developments are, on an almost daily basis, coming to the market with more news about big graphite discoveries, and progress in setting up new mining operations.

Triton Minerals, for example, just announced its graphite deposit in Mozambique contains just under 156mt of the mineral. Syrah Resources estimates its nearby deposit holds 117mt of graphite.

Add those to the list of other juniors exploring new graphite deposits – Metals of Africa, OGI Group, Bisan, IMX Resources, Stratos, Buxton, Archer Exploration, Lincoln Minerals and Kibaran, to name a few – and you’re looking at a huge potential increase in the global supply of graphite.

But without the kind of boom that some scientists predict, global demand for graphite is only expected to rise to about 2.6mtpa by 2020.

So some experts have questioned whether all the hype surrounding graphite juniors is justified.

Since climbing dramatically around July this year, many Australian-listed graphite junior stocks have declined quite significantly.

After peaking at $5.99 a share on July 11, Syrah Resources has seen its stock price slide to $3.50 this morning.

Aforementioned Triton Minerals is worth 32c a share today, after peaking at 86c in July.

And another promising junior, Kibaran, has watched its own price slide from 53.5c in July to just 27c at the minute.

So while technologists are getting excited about the future potential of graphite and graphene, share traders have lost confidence since the boom earlier this year.

What do you think? Tell us in the comments below.





Document Actions

Chinese Demand

Posted by Anonymous User at Nov 02, 2014 08:58 PM
They are eating all our iron ore and real estate currently. I imagine once they get a taste of graphite, the Chinese demand should soak up most of the supply.

Graphite - Syrah

Posted by Anonymous User at Nov 07, 2014 10:19 PM
Hi Oliver - its worth looking at Syrahs recent announcement re the recarburizer market (essentially substituting graphite for carbon) which they believe has the potential to grow the existing graphite market by as much as 2.5m tpa and that is before any growth from EV's solar, energy storage, graphene etc. SYR already have an MOU to supply 100-150 tpa into this market and more are likely
It would be great to see one these supposed expert websites actually offer some well researched opinions based on fact rather than hearsay. An interesting question for you to ponder is why is Tesla the most talked about company in the US and why does it have a mkt cap of over US$30b while the entire Aust listed graphite sector (incl SYR which is a giant) has a mkt cap of circa US$1.1b??

Graphite - Syrah

Posted by Anonymous User at Dec 27, 2014 12:13 AM
If anyone looks closer at flake size (which is ultimately what matters) and price distribution, they will want to look at Magnis Resources (MNS.AX), a potential leader in the industry with already one BINDING agreement with a chinese SOE called Sinoma, and a second one soon to come. Much hype about Syrah but they have not produced or delivered anything yet...

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