Revenue projections, page-12

We can all accept that the slow and measured pace of change, as described by Cartex, has been the norm in the past. But, if the current forecasts of EV sales are any guide, the demand from major automotive manufacturers will force battery makers to shift into a higher gear. Even a nine-month inventory holding (which would be a large investment by modern business standards) would quickly evaporate if EV sales were to rise to the levels likely by 2020. And no prudent company is going to allow themselves to run their inventory completely dry.

In addition, the world shortage of petroleum coke, mentioned in a question to the recent Quarterly Activities Presentation, means that the supply of synthetic graphite, for the production of SG, will tighten, raising prices, and pushing battery makers to seek cheaper (and available!) material from natural graphite.

In the past, without market demand pressures, it may well have taken four years of trial testing and inventory run-down before battery manufacturers changed suppliers. That luxury is disappearing. The market will not wait. The world is changing, and the pace of that change will force Li-ion battery makers to either improve their performance, or give up their markets to others who can.

One way or another, that market will be supplied. And Syrah is the only realistic, large-scale source in sight.

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