Ann: Quarterly Activities Report, page-23

The graphite market is growing, BSM should have no problem selling its large flakes graphite (its moat/competitive advantage). Small flakes are another story (due to over-supply of the market by Syrah).

From syrah Q4 2018 report :

"Syrah estimates that the natural flake and fines graphite market grew by approximately 70kt in 2018 to745kt."


Note : Syrah produces 20% large flakes and 80% small flakes.

BSM produes 50% large flakes and 50% small flakes, and they are trying to increase proportion of large flakes. 

Difference between Syrah and BSM :  size (huge VS small), different markets companies (large flakes higher value focused (1000$/t) VS small flakes lower value focused (500$/t)), (relying on economies of scale and grade to achieve profitability, VS relying on lower costs of mining/processing to achieve profitability (near surface easy to mine low energy intensive easy to process clay graphite, near distance to port/low transportation costs)). 

Even at 250.000tpa Syrah expects its costs of production wto be around 400$/t (they are actually at 550$ per tonne at 100.000tpa capacity).....BSM already approaching sub 500$/t costs at a measly 6000tpa rate.....just imagine how much costs can get lower at 20.000tpa stage2....