Graphite: The race for non-Chinese spherical graphite heats up

Lithium-ion battery

A number of companies with flake graphite mining projects outside of China have furthered their development of spherical graphite with an aim to become the first commercial-scale producer in the rest-of-world (ROW).

In April, Kibaran Resources completed engineering studies for its EcoGraf project, testing its processing methods on global samples, as well as those from the company’s Epanko project in Tanzania. An initial 5ktpy (increasing later to 20ktpy) of spherical purified graphite (SPG) would use the company’s proprietary purification technology which offers an alternative to the use of hydrofluoric acid (HF) and results in grades of more than 99.95%C. A 5ktpy plant would have capital costs of US$20.0M and a 15ktpy expansion a further US$44.4M. Operating costs are estimated at US$1,998/t for the full 20kpty capacity.

Westwater Resources also announced positive results from independent testing of its SPG in April. Purities of up to 99.95wt% were achieved and the product was considered stable at over 150 cycles. SPG was produced using flake graphite from the company’s Coosa project in Alabama, USA.

Syrah Resources, the largest flake graphite producer in the ROW has yet to output a purified product at its battery Anode Material (BAM) plant in Louisiana, USA. It is currently installing purification equipment and had plans to begin in Q1 2019 but this target does not appear to have been realised. It produced its first un-purified product in December 2018 and has 5ktpy of milling equipment installed.

Other companies looking to produce spherical graphite outside of China include Battery Minerals (Mozambique), Focus Graphite (Canada), Northern Graphite (Canada), Nouveau Monde (Canada), Mason Graphite (Canada), and Renascor Resources (Australia). There is also a multi-player partnership developing a testing plant at the Coulometrics site in Tennessee, USA.

Roskill view

China is currently the only commercial-scale producer of spherical graphite, producing in excess of 100kt in 2018 almost exclusively for use in lithium-ion battery anode material. China also dominates the lithium-ion battery supply chain and is the largest producer and consumer of anode material, battery components, and the lithium-ion batteries themselves. Although there is a sizable market for spherical graphite in Japan and South Korea, in particular for higher-performance EV batteries, any ROW company that realises spherical graphite production would be wise to look at China as a rapidly-growing EV market.

With Roskill’s new Lithium-ion Batteries: Outlook to 2028 report forecasting China’s lithium-ion battery production to grow by 13.3%py (in MWh terms) over the next decade, questions have arisen regarding the ability of the graphite industry to supply enough spherical graphite to meet the growth in demand. Chinese companies have already begun to look for new foreign raw material sources with the largest anode material manufacturer, Shenzhen BTR New Energy Materials, receiving flake graphite from Syrah Resources through 2018. Although this deal has not been renewed for 2019, Syrah Resources continues to supply other Chinese anode material companies from its mine in Mozambique. Its flake graphite has so far been processed into spherical graphite after export to China.

Chinese companies are looking increasingly at foreign sources of flake graphite and Africa could potentially provide an additional source of well-located, low-cost raw material; zero tariffs are in place for imports into China from this region and China is currently investing widely to develop Africa’s infrastructure.

Production of spherical graphite is an attractive goal for mine developers since the added value, downstream product can achieve much higher returns than basic concentrate. The average value of spherical graphite exported from China is typically 3-4 times higher than small- to medium-sized flake concentrate (the preferred flake size for this industry), at around US$3,000/t in early 2019.

Barriers to entry for spherical graphite production are high, however, especially in the ROW which has previously found it hard to compete with China’s lower labour and energy costs, and its less stringent environmental restrictions. Although environmental costs are rising in China, the traditional method of flake graphite processing to produce spherical graphite, including the use of HF and other strong acids, continues. ROW producers looking to distance themselves from this method have looked to develop their own proprietary methods of purification, but it remains to be seen if any can scale-up to commercial production at costs competitive with China.

Spherical graphite competes with synthetic graphite as a lithium-ion battery anode material.

Roskill’s NEW Lithium-ion Batteries: Outlook to 2028 report was published in April 2019 and its NEW Natural & Synthetic Graphite: Outlook to 2028 report will be published in June 2019. Click to download the brochure and sample pages or to access further information.