As the primary component of the anode material in lithium-ion batteries, graphite plays a crucial role in North America’s push to establish a secure supply chain in support of the growing electric vehicle (EV) industry.
But the resource also has a diverse set of applications beyond the battery space, from pencils and greases to refractory products and fire-retardant building materials. As such, graphite may be a compelling investment opportunity for many.
By gaining a deeper understanding of graphite’s supply and demand dynamic, along with its many industrial applications beyond batteries, investors can more readily identify promising investment opportunities with this critical mineral.
In light of this looming shortage, cross-commodity price reporting agency Fastmarkets expects graphite’s market price to increase, driven by mounting underlying costs.
A seam mineral formed through contact metamorphism, amorphous graphite’s high heat tolerance means it’s well suited for industrial processes such as steel production. The mineral is also used to make brake linings, gaskets, clutch materials and pencil lead.
Flake graphite forms when carbon is subjected to both high temperature and high pressure. The largest buyer and consumer of flake graphite is the automotive industry, as the material is used in multiple vehicle components. Flake graphite is also a key component in EV batteries and nuclear reactors.
Crystalline vein graphite is known for its incredibly high purity. It also has a higher thermal and electrical conductivity than the other types of natural graphite. As such, it can be used for all the same applications as flake graphite.
There are several recent investments in North America that investors may find worth looking into.
Metals Australia owns one graphite and several battery metals projects in Canada and Australia.
The company’s flagship project, Lac Rainy, is situated in a major graphite province in Eastern Quebec. In addition to exceptionally high-grade and widespread graphite sampling results, Lac Rainy has easy access to both transportation and energy infrastructure, including hydroelectric power.
MLS is progressing development studies and undertaking key measures to advance the Lac Rainy graphite project including a prefeasibility study for a 100,000 metric ton per annum flake graphite concentrate plant, a metallurgical and laboratory services agreement with SGS Laboratories, assessing a downstream battery-grade spherical graphite concentrate purification option and scoping study, as well as engaging a contractor for drilling and full-service support.
Metals Australia is very well funded to complete all planned studies. Given its resource size, grade and potential for significant growth it’s also likely to come onto the radar of governments supporting development of critical minerals projects in North America.
Syrah Resources produces graphite from its Balama / Nicanda Hill property in Mozambique.
The company aims to be the first major non-Chinese integrated producer of natural graphite active anode material.
Graphite has made headlines in recent years due to its pivotal role in enabling the clean energy transition. However, the applications and potential of this critical mineral are far more comprehensive than batteries and energy storage. Graphite has long been important to the manufacturing and automotive sectors, while emerging applications such as graphene hulls and plating show incredible promise for the future. Experts believe the future is bright for graphite, supported by the announcements of funding from the private and government sectors, particularly in North America.
This INNSpired article was written according to INN editorial standards to educate investors.
INN does not provide investment advice and the information on this profile should not be considered a recommendation to buy or sell any security. INN does not endorse or recommend the business, products, services or securities of any company profiled.
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