One big seller yesterday, page-41

Canaccord Genuity Mining Analyst, Luke Smith

Part of the Chinese rush to secure more graphite is said to be the rising costs involved in the mining of the graphite at their disposal. The government has been on a crackdown for several years on unsafe mines and is still trying to get to grips with environmental pollution, not a situation to be taken lightly given the notorious smog that clouds major cities like Beijing.

Perhaps few stakeholders will be sad to see the Chinese stranglehold on world graphite supply diminish, as repeated, sudden mine closures over the past few years knocked significant supply lines offline on a whim. Manufacturers prefer more stable and diverse supply.

New Graphite Suppliers will be Approached

With all that demand, and Chinese graphite in eclipse, who will step up with new supply?

There are a few new developing producers to watch out for. The graphite companies in the Australian junior index jumped in value by 120% to US$ 1.1 billion in 2014. Syrah Resources is one of them. Another is Graphite One. Their property at Graphite Creek in Alaska is the largest known, highest grade, large flake graphite deposit in the US. The mine has a lifespan that could well be 100 years - 4-times larger than any other known graphite deposit in North America.

Game On

The graphite crunch has already started. The move by Chinese company Chinalco was the trigger.

That the world's largest producer of graphite, with tumbling production, China is signing on graphite properties before they even go into production is the surest sign that the game is on.

Other mining juniors are sure to see increased interest in the near future.