Investing In Graphite Part 2, page-21

Jaded,

You are a big reader of all these Jr Graphite mining companies. What to you believe is today current total world wide demand for natural flake graphite? What % of the total worldwide demand today is consumed within China?

Second what do you believe is the total worldwide Capacity? Do you believe all worldwide graphite mines are operating at full current capacity and if not then what do you believe is the estimate of excess capacity today?

Yes i agree with you making Synthetic in China creates more pollution issues then Natural Flake does. The question will the Chinese government do anything to change this? Only time will tell. Remember today their is about 40 to 50 % excess capacity worldwide in production of synthetic graphite electrodes.

Not sure what your trying to say with your quote"trad house plot especially by Riddle of Asbury". Please explain?

I agree with you that there will be new inventions that will make clearer processing methods for natural flake graphite. However China will still produce close to 100% of the purified natural flake graphite anode material for many years to come.

Re Flinders
They are in trouble with their new graphite mine in Sweden since they are not able to produce the higher purity level >94 % carbon. The net result is average selling prices for the 85 to 93 % natural flake they are mining and producing is today below their production cost. Thus not only are they having difficulty trying to sell the total output they are having to sell at below cost.

Re Talga
They are now betting 100% on the Graphene market. I wish them the best of luck developing this market. It will be extremely difficult for them to sell any volume. I have stopped following them.

Re Kibaran Nickel Ltd.
Yes they have 2 offtakes with EU graphite traders. One with a German trader for German market and another with a German trader for rest of EU excluding Germany. The question is where are they going to sell all the rest of their proposed Capacity? The 2nd question is at what average FOB mine price can they expect to sell at? What will be the realistic CAPEX and realistic operating costs? Then base on these costs and selling prices will someone be willing to providing the necessary funding base on all the risks. Time will tell.

The EU market demand is less in 2015 vs. 2014 thus the reason why prices have been decreasing. This is true worldwide.