ann out, page-21

Transit

"It doesnt change the graphite product economics, the larger the flake the more money will be paid. Its as simple as that."

No offence, but it is NOT as simple as that. Don't just look at price charts and automatically believe them.

Firstly, there is a critical mass point where the size of the flake no longer matters.

Secondly, the shaping properties of the flake is a HUGE factor. If the flake cannot be shaped into spherical graphite, the price of the graphite received will be much less.

Thirdly, the initial purity of the graphite (without further processing) is a huge factor in the price that will be received for the graphite. One could arguablly sell smaller flake product with higher purity at a higher price than larger flake product with lower purity. In other words, metallurgy is critical.

Fourthly, since this is a contract based market rather than a spot based market, there are SEVERAL other factors that need to be considered, not least of which is the ability for the company to provide security of supply to its customers. The better the security, the better the price.

And FIFTHLY and most importantly, is where a huge deposit all of a sudden appears and the company that owns that deposit collapses the price of graphite to grab market share (ie in a contract based market). It wont matter what the flake size is then. I'll stump up and say I believe Syrah will be that company.

Cdchi1