Flinders Resources CEO Blair Way Discusses Tesla and the Graphite Sector

Flinders Resources Limited (TSXV:FDR) President and CEO, Blair Way, discussed Tesla and factors to consider when analyzing a graphite company in an interview with The Gold Report recently.
In the interview Mr. Way is quoted as saying:

 Because graphite is used in many energy-related applications (including electric vehicles, Pebble Bed Nuclear Reactors, fuel cells, solar panels and electronics ranging from smartphones to laptops), it has been categorized as a critical, strategic mineral by several governments including the United States and Europe.
What does this really mean? At this point in time it means nothing—graphite is in oversupply and prices are low. However, if China decided to stop supplying graphite to the world, then the West would be in trouble. This is highly unlikely to ever happen. As far as the impact of the Tesla plant on the greater market, that’s yet to be defined in detail, but it will create more demand for graphite, both natural and synthetic.
The market should be considered by dollar value not just tons per annum. As a comparison, the 1.1 Mtpa of graphite is worth $1.3B while 1.8 Mtpa of nickel is worth $26B. As a new entrant to the market, nickel is a significantly larger market than graphite. So to put the graphite market in perspective, the non-Chinese natural flake graphite market is a $300 million ($300M) market. This is the market in which all the Western graphite producers (current and future) are vying for position.
That is why a new graphite production facility must start small and build relationships in the current market while developing products that can supply the anticipated future markets. Cash flow for a graphite business must be sensible in today’s market.

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