Syrah misses Q1 2019 graphite price goal but ramps up production

By IM Staff
Published: Thursday, 14 March 2019

The miner achieved lower than expected average prices in the quarter, but remains optimistic as output increases.

By Jon Stibbs

Graphite producer Syrah sold its material at a weighted average price of $460-470 per tonne on a cif-destination basis over the first quarter of 2019, according to its interim report published on Thursday March 14.

The Australia-based company had published a guidance range for sales at $500-600 per tonne and said the shortfall of $40-130 per tonne could be explained by a high proportion of sales of cheaper fines graphite and "faster than anticipated progress towards [the] close out of lower priced contract volumes from 2018." Syrah did not provide a breakdown of its fines and coarse graphite production.

The closest equivalent price assessed by Fastmarkets IM is for 94-97%C graphite flake, -100 mesh, on a cif Europe basis. This was assessed at $650-840 per tonne on March 14, steady over the first quarter.

Syrah said it was "optimistic that improved prices are achievable on the basis of the forward contract and product mix."

Production over the first quarter of the year matched the bottom end of its production goal of 45,000-50,000 tonnes.

The company reported its sales volumes were anticipated to be higher than production volumes at 45,000-50,000 tonnes. However, this would be subject to shipping in March.  

Meeting the company’s production goal represented a recovery for the company, which had been hit by problems at its Balama graphite operation in Mozambique.

A fire and issues with equipment and at a plant in 2018 meant the company could not meet its contract commitments for that year.

Graphite output from the asset in 2018 was 104,000 tonnes, which was significantly short of its initial target of 160,000-180,000 tonnes.

Approximately 20% of production in 2018 was coarse flake graphite, and the remainder was fines.

In 2019, Syrah declared it had started commercial production at Balma and achieved its first production of unpurified spherical graphite at its battery anode material (BAM) facility at Louisiana in the United States.

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