Battery Metals

Graphite Investing

With graphite’s significant usage in lithium-ion batteries, the battery industry will allegedly need somewhere around 290,000 metric tonnes of flake graphite over the next decade.

To put it simply, Tesla Motors (NASDAQ:TSLA) has been a driving force in ramping up demand for graphite with its role in lithium-ion batteries over the last couple of years. 
Of course, lithium-ion batteries—and to that extent graphite—have many uses and can be found in laptops, electronic devices and electric cars, so with that in mind the graphite market is poised to continue growing stronger over the next decade.
Future Market Insights suggests global sale of graphite to be around $14,690,000 by the end of this year, which is 9 percent increase from 2015.  Specifically, the news release says countries in Asia Pacific will be a key factor, with 35.5 percent of global market coming from the region.

Graphite market: driving forces

Of course, demand for lithium-ion batteries, especially in electronic vehicles, will continue pushing the market’s growth. According to Alt Energy Stocks, the lithium-ion battery sector is expected to reach as high as $46 billion by 2022, which works out to be an 11 percent annual growth over six years.
The publication adds that consulting firm Avicenne Energy indicates the battery industry will need at least 290,000 metric tonnes of flake graphite by 2025, compared to just only 118,000 metric tonnes used in 2014.
On the other hand, Future Market Insights writes that, “on the basis of product type, synthetic graphite segment will continue to find favour among end-use industries,” however a slowdown of mining in China is expected, which will push production of natural graphite down. That being said, Future Market Insights adds that this will push demand up for synthetic graphite.

Who to watch for

So, with the future outlook of graphite remaining positive, here’s a look at a few companies who have had relative success in the sector and what they’re currently up to.
Canada Strategic Metals (TSXV:CJC
Canada Strategic Metals is focused on exploring and developing its portfolio of graphite projects in Quebec in addition to advancing its gold projects.  The company’s graphite projects include the La Loutre Project and Lac des Iles West. Most recent graphite news from the company was released in May 2016, wherein Strategic Metals announced Lomiko Metals (TSXV:LMR) signed an additional option agreement on the La Loutre and Lac des Iles properties, which would allow Lomiko to acquire up to 100 percent interest.
Year-to-date, shares of Canada Strategic Metals have increased 583.33 percent to $0.205.
Mason Graphite (TSXV:LLG)
Mason Graphite is 100 percent owner of the Lac Gueret graphite project in Quebec. In September 2015, the company released its results from the Feasibility Study for the project, which the company describes as having a long life and low cost operation. Mason Graphite is continuing its focus on obtaining permits required to finish construction in 2016, with production beginning in 2017.
Overall, Mason Graphite’s shares have risen 261.76 percent year-to-date to $1.23.

Flinders Resources (TSXV:FDR)
Shares of Flinders Resources have seen significant gains this year as well, rising 210 percent year-to-date to $0.465.
The company operates the Woxna Mine, however in 2002 the mine ceased operations due to low graphite prices. Production and processing started again in July 2014.  In June, the company announced a permit for expansion and high purity graphite production. “Re-permitting of the Woxna site will allow for an increased graphite production rate across the site and an expansion of the range of graphite products that can be produced, including high purity materials,” the release reads.

Northern Graphite (TSXV:NGC)
While not as high as Canada Strategic Metals, Mason Graphite, Flinders Resources, Northern Graphite’s shares are still up 63.64 percent year-to-date to $0.36.  The company owns 100 percent interest in the Bissett Creek deposit in Ontario, which is currently in an advanced stage towards a final feasibility study. According to the website, the project has the highest percentage of large flake material.
Northern Graphite’s latest news release came out in March, wherein it was announced they had joined with other graphite companies including Elcora Advanced Minerals (TSXV:ERA), Nouveau Monde Mining Enterprises (TSXV:NOU), Metals of Africa (ASX:MTA) and Coulometrics for spherical graphite development.
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Securities Disclosure: I, Jocelyn Aspa, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Flinders Resources is a client of the Investing News Network. This article is not paid for content.


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