Graphite: Chinese imports from Africa surge in November

Chinese imports of flake graphite (excluding intermediate spherical graphite products produced from flake) increased dramatically from 6.7kt in October 2018 to more than 10.0kt the following month. Monthly imports of flake have averaged 5kt since April and have been growing strongly since late 2017 when Syrah Resources Balama mine came on-line in Mozambique. By comparison, Chinese imports in November 2017 were just 1.0kt.

Roskill view:

China has been the world’s largest producer of flake graphite for several decades, but domestic demand is increasing with the expansion of the global lithium-ion battery market. China dominates much of the lithium-ion battery supply chain, including the production of anode materials from graphite and other carbons and, increasingly, battery component manufacture and final battery assembly. With the emergence of electric vehicles worldwide and the potential for China to lead this new market, Chinese demand for graphite is surging. Despite large domestic resources, China has begun to look, seriously, at foreign sources of supply, especially under the spotlight of continuous environmental inspections and production plant closures in its own backyard.

The world’s largest lithium-ion battery anode materials producer, Shenzhen BTR New Energy Materials, had a supply deal for the first year of Balama production which is now believed to have been replaced with several new deals across a range of Chinese consumers. Limited graphite price increases and a lack of industry investment has so far restricted rest-of-world development of flake graphite projects but China is likely to look to Africa for any further possible supply deals as the continent provides a potential source of low-cost production, especially as China’s own mining costs continue to rise with increasing labour, energy, and environmental costs.

Roskill’s Natural & Synthetic Graphite: Global Industry, Markets & Outlook report was published in July 2018. Click here to download the brochure and sample pages or to access further information.

To discuss the graphite market with Roskill, contact Suzanne Shaw: