42% fall in SP possible, page-38

Here is a genuine concern that I hold. It is not specifically about SYR per se. It is about the future price estimates and the graphite market. I believe that the commonly used price projections are way to optimistic. For my own analysis I use a range of $500 to $1200 across the variety of basket prices.

The current demand is sure to grow, no doubt in my mind about that projection. However, on the supply side I see the growth being faster than the demand. Plus, I have always maintained that if SYR goes into production with their by product sales of vanadium, they have the potential to blow the market to pieces. For instance, they would still be profitable selling graphite into the carbon market for around $300/t as the profit would be underpinned by V2O5 sales.

Regardless whether an actual blow up happens, the potential for it will be enough to scare away most financial backers for other projects.

This leads me to conclude that so many potential good graphite deposits will be left floundering because their project economics will not stack up in a low price market. That means that they will not get the funding necessary to develop into a producer.

The SYR DFS for graphite will be interesting, especially if it includes the spherical graphite economic study. However, the SYR DFS for vanadium will be much more enlightening IMHO because it will provide the holistic picture of the challenge for all other potential graphite producers.

Cheers