Syrah Resources Boosts Supply of Mozambique Graphite to South Korea

Syrah Resources said the signing of a binding offtake agreement with South Korea’s Posco Future M further confirms a move away from Chinese suppliers of battery metals such as active anode material (AAM).

Posco Future M (previously Posco Chemical) is a major battery materials business producing cathode active materials and AAM.

AAM has been identified as a key ingredient in the modern batteries for electric vehicles (EVs) and energy storage and Syrah says recent Chinese and US government moves have made sourcing battery materials outside of China more attractive.

Syrah Resumes Operation at Balama Mine in Mozambique

The natural graphite fines from Syrah’s Balama operations in Mozambique are considered a globally important source for AAMs, with Posco Future M one of a number of companies interested in offtake agreements.

Syrah managing director Shaun Verner said the Posco deal highlights his company’s unique position in having natural graphite and AAM supply outside of China.

He said Posco Future M is one of the largest AAM producers globally and is planning to significantly increase its natural graphite AAM production capacity this decade.

Syrah Resources Expects Jump in Mozambique Graphite Purchases Ahead of China Ban

“Furthermore, there is increasing interest from battery manufacturers and auto original equipment manufacturers (OEMs) in directly contracting sustainable upstream supply of ex-China natural graphite for anode processing partners,” Verner said.

This has become more urgent following the decision on 1 December 2023 of China’s Ministry of Commerce and General Administration of Customs to implement export controls for designated “dual-use” graphite products used in commercial and defense applications including batteries, citing safeguarding of national security and interests.

Ex-China AAM and battery supply chains are currently largely reliant on Chinese natural graphite and AAM exports.

Syrah Resources Restarts Graphite Production in Mozambique

According to Syrah, Balama is the only major independent source of high quality, large volume supply alternatives to meet new requirements.

The offtake agreement with Posco is for up to 2 kilotonnes per month in the year following commissioning, and from 2kt to 5kt per month (24 to 60kt per annum) at the option of Posco Future M, with at least six months’ notice from the second year to the end of the term.

The agreement is for six years commencing upon notification from Posco Future M.


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