While lithium has enjoyed a stunning price rally over the past year amid a supply crunch and growing demand for electric vehicles, graphite has not been shown the same favouritism.
But some pundits believe that could be about to change, with research by Benchmark Mineral Intelligence forecasting an imminent supply shortfall.
“Lithium-ion battery demand was only 3 per cent of global natural graphite supply in 2012 and in 2023 we’re going to see it become the biggest consumer of natural graphite,” said Tom Revy, managing director of Perth-based graphite developer Evion Group.
“There’s a massive shift and it’s the same shift we saw in lithium and it’s the reason lithium really took off in price, and why we’ve seen nickel move quite considerably.”
Graphite has a wide variety of uses which include serving as a crucial component of lithium-ion batteries, being the primary material used for one of two electrodes known as the anode.
Benchmark forecasts natural graphite anode material supply will grow by 95 per cent by 2030, while tipping demand to surge 450 per cent. It also expects a global shortage of 6.1 million tonnes of natural graphite by 2035, saying 97 new mines — each producing 56,000 tonnes annually — will be required to meet projected demand over that timeframe.
Evion Group — formerly Blackearth Minerals — believes its flagship Maniry graphite project being developed in Southern Madagascar will position the company to capitalise on strong growth in demand for non-Chinese supplies of battery anode material.
China dominates much of the graphite market and produced 64 per cent of mined graphite across the lithium-ion battery value chain last year, according to Benchmark.
Evion also recently completed a scoping study to build a downstream processing facility in Germany to process graphite concentrate from Maniry into uncoated spheronised purified graphite (SPG) for use in lithum-ion batteries.
While millions of dollars are being poured into the battery supply chain from European governments and auto makers, Mr Revy said there was little investment being made upstream.
“That’s where we want to take advantage . . . we think the leverage in the next two-plus years will be in the raw material producer,” he said, noting Evion’s product would also be available for use in hydrogen fuel cells and vanadium flow batteries.
“We’ll be an intermediate battery anode material producer. We want to do that in Europe because currently no one is doing that in Europe.
“100 per cent of SPG is made in China and the world needs to diversify from a geopolitical dominance point of view.”
Mr Revy noted the neighbouring Molo graphite project by Canadian company NextSource Materials would be in production this quarter and validate Evion’s plans to operate in the East African country.
“It’ll really be proof of concept from our point of view once they’re up and running,” Mr Revy added.
Perth-based Talga is among other WA companies looking to crack the graphite market by building a fully integrated lithium-ion battery anode supply chain in Sweden through its Vittangi project.
Meanwhile, EcoGraf is targeting Tanzania to develop a natural flake graphite business.
The World Bank expects almost 53.8 per cent of mineral demand from energy storage to come from graphite through 2050, while lithium is tipped to account for just 4 per cent of total demand.
