China announced last month that it would require export licenses for some graphite products, in another effort to control supplies of key minerals to counter challenges to its global manufacturing dominance.
China is the world's largest producer and exporter of graphite. It also refines more than 90 percent of the world's graphite into the material used in nearly all electric vehicle battery anodes. Benchmark Mineral Intelligence expects demand for graphite to grow at a compound rate of 10.5% per year over the next decade, but supply will lag, growing at only 5.7% per year.
While 200,000 tons of graphite are needed to meet demand, the reality is that the current U.S. supply capacity is zero.
North Graphite this month reopened North America's only producing graphite mine, at Lac des Iles in Quebec, Canada, which the company had serviced and maintained during the second and third quarters of the year due to challenging market conditions and product prices.
This is a gap in the North American market, and graphhex Technologies - one of the top 10 global suppliers of specialized spherical graphite to the electric vehicle and renewable energy industries - is looking to fill it. graphhex Technologies is a wholly owned subsidiary in the United States of graphhex Group Limited, a Cayman Islands company that already has an independent graphite processing ecosystem in China. Its graphene division currently produces 10,000 tons of purified spherical graphite per year at its plant in Heilongjiang province.
Last year, the company spent $75 million to acquire a former auto plant in Warren and plans to convert it into a graphite processing plant, setting up a graphite joint venture outside Michigan. In June, Graphex received the required environmental clearance for the facility from the Air Quality Division of the Michigan Department of Environment, Great Lakes and Energy.
Graphex Technologies CEO John DeMaio used the export control announcement to reiterate its global mine-to-battery strategy to provide the necessary anode materials to meet the needs of North American automakers and battery manufacturers.
"The announcement of controls on graphite exports is a loud wake-up call for the United States and Canada and a national security issue, plain and simple, for which we have been preparing," de Maio said at the time.
"Given the tensions over the last year, we always knew there was a possibility that China would make some sort of concession," DeMaio told MINING.com.
"The EV and lithium-ion battery ecosystem in China is way ahead of everyone else in the world, so the demand there is huge."
"The graphite deposits in China that they mine, process, consume, that we can see from a mile away, coupled with the geopolitical tensions, yes, it's not inevitable, but it's not surprising that it's happening," De Maio said. I think it's amazing that it happened without any notice."
Expand the portfolio of partnerships
Graphex currently has a global offtake agreement with Syrah Resources, owner of the Balama mine in Mozambique, the world's largest graphite production facility. Working with Northern Graphite to produce raw materials in Canada and Namibia; South Star Battery Metals, supplied from Brazil and the United States through the Santa Cruz Graphite Project and the Ceylon project; Partnered with Volt Resources to provide graphite from its Bunyu graphite project in Tanzania; Working with Gratomic to source natural graphite from its Aukam project in Namibia and with reform Group to supply material from its secure deposit in Australia.
"We had plans to expand and diversify long before the IRA broke out," De Maio said. "We have announced plans to build a plant in North America and diversify our upstream supply. It makes sense to bring raw materials as close to shore as possible, or even to shore if possible."
DeMaio pointed to graphite deposits in Alabama owned by Westwater Resources and South Star Battery Metals as a potential future source of domestic supply.
"We expect this will obviously lead to a greater focus on localising supply... And accelerate our plans to build more infrastructure and more processing capacity here."
"Although we have a presence in China, we are not a Chinese company. We are looking at ways to separate or create a separate entity." "This confirms our strategy. We need to build plants in Canada and the lower 48 states that can handle 50,000 or 100,000 tons of production."
