graphite "in a nutshell", page-4

Supply of Graphite

According to a recent Graphite presentation by company ASX:AXE

Total world production in 2010 1.1 Mt

China produces around 75% of the world’s graphite. Quality is reportedly declining and supply suffers from the seasonal closure of mines. It is reported that up to 180 graphite mines in the Hunan Province have been closed recently taking up to 200kt of amorphous graphite out of the market.

Mine closures in part to preserve resources. China has imposed a 20% export duty plus a 17% VAT and has instituted an export licensing system to ensure supply to its domestic economy. The dominance of China as a producer coupled with measures introduced by the Chinese government are creating supply concerns for the rest of the world. Supply issues are exacerbated by the lack of exploration and new mine development.