China’s COVID-19 lockdowns boost demand for Mozambique graphite, Syrah says

 

Australia’s Syrah Resources is seeing strong demand for the graphite it mines in Mozambique, thanks in part to China’s COVID-19 lockdowns which are impacting production there.

Syrah operates the Balama graphite mine in Mozambique’s Cabo Delgado province and is one of the world’s biggest producers of graphite, a key component of lithium-ion batteries used in electric vehicles.

Mined graphite production from top supplier China has been impacted by COVID related logistics interruptions, Syrah chief executive Shaun Verner said in a quarterly update.

Syrah Resumes Operation at Balama Mine in Mozambique

“Chinese natural graphite production constraints are evident, with higher Chinese natural graphite imports required to satisfy demand, and Syrah’s forward sales orders indicate customer concern regarding Chinese natural graphite production availability and market balance,” he said.

During the quarter, Syrah signed a memorandum of understanding with Japan’s Mitsubishi Chemical Corporation to collaborate on the development of battery materials.

This follows Syrah’s December 2021 offtake agreement with Tesla for the supply of 8,000 tonnes of natural graphite active anode material per year from its Vidalia facility in the United States.

Tesla turns to Mozambique to reduce its dependence on China for graphite

Syrah suspended logistics and personnel movements at its Balama mine for a week in June as a precautionary measure due to insurgent activity in the Ancuabe region of Cabo Delgado province. The company said its operations, employees and contractors were not impacted by the incidents, which took place more than 200 km (124 miles) from the mine.

On Wednesday, gem producer Gemfields reported an attack near its ruby mine in Cabo Delgado’s Montepuez district, but said operations had not been halted.

 

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