Graphite: Flake project developments heating up

Posted 15th March 2021 in  Industry news.By Suzanne Shaw

The graphite industry has become a focus for new investment opportunities in recent weeks, allowing the further progression of flake graphite development projects ex-China. In Australia (the location of numerous graphite development company headquarters), total private capital expenditure across all sectors rose by 3% Q-o-Q in Q4 2020, its largest increase in private capital spending since 2012, and has remained strong through Q1 2021.

Roskill View

Market confidence has been boosted by continued demand recovery through Q1 and reduced market uncertainty, as well as rising graphite prices, the re-establishment of supply chains and a raft of government stimulus packages.

Demand recovery has been underpinned by growth in the Chinese EV/battery sector, but also by higher-than-expected crude steel production/refractory demand since the second half of last year. Many developers have begun to furiously progress projects downstream, with particular focus on battery grades, to take advantage of rising demand. Numerous project announcements have been made in recent weeks.

Meanwhile, prices for graphite and other refractory raw material prices have risen as a result of Chinese environmental closures and logistical disruption post-COVID-19. More analysis of supply disruption and price trends are provided in Roskill’s recent White Paper ‘Impact of China environmental closures on refractory raw materials’.

While flake prices showed initial signs of stabilising in early March, suggesting an easing of some of the supply and logistical disruptions, market tightness may remain due to lags in supply ramp-up. Any battery-grade producers still off-line are now rushing to bring back production to meet the rapid demand increases predicted for 2021.

Roskill’s Natural & Synthetic Graphite: Outlook to 2030, 13^th Edition report highlights the major trends in graphite supply, demand, trade, and prices, as well as providing forecasts to 2030, profiles of the main producers, an industry cost curve for spherical graphite and a focus on supply chain sustainability.

https://roskill.com/news/graphite-flake-project-developments-heating-up/