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SYR - SYRAH RESOURCES LIMITED


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Came across these two articles recently from the Marubeni Research Institute. SYR has OTA's with Marubeni for flake and spherical

Cultivating New Business Based on the Spread of EVs - Marubeniâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢s Graphite Business in Mozambique

July 27, 2018

extract

Moreover, over the last 10 years or so we have been following the almost day-to-day advances in LiB

technology, assessing market trends and accumulating knowledge through our handling of almost all the parts and materials

for LiBs. Utilizing this experience, we aim not only to deepen our materials business, but are also are looking to expand our

departmentâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢s and Marubeni Groupâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢s entire battery business at every stage of the supply chain; upstream, midstream and

downstream

 

also part of their strategies

World Focuses on the EV Battery Material Cobalt - Marubeniâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢s CobaltRelated Business

https://www.marubeni.com/en/research/report...altBusiness.pdf

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Flake graphite prices in China set to fall again on weak demand, strong imports

By JON STIBBS, HUAQING FU

Published: Friday, 26 July 2019

 

The market for 100-mesh flake graphite in China is unlikely to recover from the influence of high export volumes by Syrah Resources and low demand from the refractories sector, until demand from the battery sector ramps up.

 

The combined effects of new supplies of flake graphite from producer Syrah Resources and persistent weak demand were likely to continue to weigh on the price of the product in China, market participants told Fastmarkets on Thursday July 25.

 

https://www.indmin.com/Article/3886185/Grap...ng-imports.html

 

 

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Another Canadian company who are focused on methods of producing graphite in an environmentally sound way. Interesting what they say

 

Our processes require no acids or alkaline systems and result in no environmentally damaging productions, by products or waste. This makes Elcora one of the most environmentally friendly graphite producers.

 

Besides the low environmental impact, not using acids or alkaline systems could also yield better quality graphite. Acid treatment changes the graphite property resulting in a thermally unstable product. Depending on the treatments, acid exposed graphite can exfoliate, or âââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’…âہ“popâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’‚ at temperatures as low as 200Ãâہ¡ÃƒÆ’‚°C resulting in catastrophic form of battery failure. Elcora graphite is stable in oxygen environments to approximately 800Ãâہ¡ÃƒÆ’‚°C and in inert environments to almost 3000Ãâہ¡ÃƒÆ’‚°C.

https://www.elcoracorp.com/processing-raged...ssing-facility/

 

I can recall back in 2016 a HC poster providing a series of extracts from a Credit Suisse report on SYR - one of the comments was that "end-users outside China are demanding, as an absolute requirement, that spheroidal graphite for batteries must be chemically purified". Haven't come across the view of CS anywhere else. But then some of the other views expressed in the CS report have also been proven now way off the mark - i.e. the project was at the time (2016) "fully funded" and that "What if graphite prices fall? Balama is at the bottom of the cost curve. For an additional capex of US$80-100m, they could double production. This is a far lower capital intensity than any of the competition. The result would be that SYR would be profitable, while existing producers were "driven to insolvency", and "unfunded aspirational producers" (like that phrase?) shelved plans for operation".

 

extract from the post

CS are renowned for their careful, conservative analysis. Sometimes key facts are so politely put that the message does not really show through. But in the latest CS report on Syrah, Michael Slifirski, one of Australia's most highly regarded minerals industry analysts, does not hold back. If anybody wants to know where the graphite mining business is going, they can't afford to not read what he says.

 

I can only touch on a few of the points he covers, but they may give some indication of just how he lifts the lid.

 

9. Purity requirements for Battery graphite

 

There are increasing quality concerns over Chinese supply, brought to a head by the recent Samsung phone battery fires. Those batteries were apparently made from blended product, from multiple mines, significantly increasing risk of contaminants which, even in minor traces, can cause issues. This has now reached the point where end-users outside China are demanding, as an absolute requirement, that spheroidal graphite for batteries must be chemically purified.

 

 

Meanwhile SP still trending down. Short activity also down. Currently #8 with 13.07% as at 29.7.19 - https://www.shortman.com.au/stock?q=SYR

 

One large trade yesterday -1:31:59 pm 1:31:59 pm 82 8,629,476 1.5 $7,076,170 1

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JP Morgan back becoming a substantial holder - BORROWED 6.2 mil shares on 2/8/19. Probably reached their target today. SP in the "seventy's" for the first time in many years - 2012. Finished the day @ 77c.

https://www.asx.com.au/asxpdf/20190806/pdf/...8b6gjyh8qkl.pdf

 

70c was the price Viceroy put on SYR back in 2016. Around the same time one of the insto's - Credit Suisse if I recall correctly - had a $7.00 target - as per this article in The Australian. Since then of course we'ver had all of them readjust their targets downwards. Have to say Viceroy's target is getting uncomfortably close. Not sure if JPM's latest borrows will be returned after today's drop. Mind you I think most of the selling action in the last couple of days is as a result of the US-China trade wars

 

Syrah Resources: is this Tesla-driven stock worth 70c or $7?

https://www.theaustralian.com.au âââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’‚º business âââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’‚º wealth

 

Syrah approaches regulators about short-selling critics

https://www.afr.com/business/mining/syrah-a...20170523-gwbaf5

 

2-Aug-19 J.P. MORGAN SECURITIES AUSTRALIA LIMITED Equity Borrow 4,300,000 $ -

2-Aug-19 J.P. MORGAN SECURITIES AUSTRALIA LIMITED Equity Borrow 1,000,000 $ -

2-Aug-19 J.P. MORGAN SECURITIES AUSTRALIA LIMITED Equity Borrow 900,000 $ -

https://www.asx.com.au/asxpdf/20190806/pdf/...8b6gjyh8qkl.pdf

 

Shaun Verner is at the Diggers & Dealers - due to give a SYR presentation tomorrow @ 12.45

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Not sure if JPM's latest borrows will be returned after today's drop

 

Adjustment (3,456,000). JPM ceased being a subholder on 5/7/19.

 

SP up 2.53% currently 81c. Notice how trading volumes decrease when short positions closed. Expect the SP now to go up once again, followed by another sell down - will continue until some substantial positive news - just IMHO

https://www.shortman.com.au/stock?q=SYR

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Perhaps Glencore's actions in temporarily shutting down their cobalt mine in DCR - due to lack of demand and subsequent low prices - might be the answer to SYR's current problems? extract below which I posted in the cobalt thread

 

Miners find out the hard way why cobalt is called the goblin

Bloomberg News | August 7, 2019

 

For Glencore, the precipitous fall in cobalt is more bruising because the metal, a key ingredient for batteries, was its shining star back in 2017. The miner made its copper and cobalt assets a big part of its selling pitch to investors, touting the future boom in electric cars and global urbanization.

 

But the strategy hit pitfalls. Excess supply has overwhelmed demand for battery materials and because itâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢s a niche market, Glencore hasnâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢t been able to hedge its exposure to cobalt, leaving the metals trading business exposed to losses. To make matters worse, Glencore detected uranium in some cobalt last year, rendering it unsaleable.

 

To be sure, Glencore isnâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢t giving up on Mutanda entirely. It expects to bring it back online in 2021 and is looking at a new mine plan that could boost production over the long term. The restart might coincide with electric cars becoming more popular with consumers, which would boost demand.

 

That could leave Glencoreâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢s traders on a strong footing as they negotiate supply deals with customers who pulled out of contracts when prices were weak. âââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’…âہ“People who have reneged on us in the past, of course theyâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢re not going to be top of our list,âââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’‚ Glasenberg said.

 

read more - https://www.mining.com/web/miners-find-out-...led-the-goblin/

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Gets a mention here - Graphite: Flake prices falter as African exports meet new demandâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’… ÃƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â‚¬Å¡Ã‚¬Ãƒâ€šÃ‚âââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’… for now

Prices for natural flake graphite have fallen through H1 2019 following a period of relative stability in Q4 2018. Prices declined by relatively minor amounts through the first quarter of this year but began to fall more steadily through the second quarter. FastMarkets reported prices for 94% C grade flake, FOB China, to have declined by 6%, 3% and 4% for fine (-100 mesh), medium (+100 mesh) and large (+80 mesh) size flake respectively in Q2 2019 compared with those in Q1. Prices continued to fall further in July.

Roskill View

Flake graphite prices have been suppressed as an increasing amount of supply enters the market from the ramp-up of African producers. Mainly in Mozambique and Madagascar, this extra production is being exported, mostly to China. Chinese imports from Mozambique and Madagascar have increased almost every month since early 2018. Imports of natural graphite from Mozambique were virtually zero in Q4 2017 but had increased to 14.1kt by Q2 2019, while imports from Madagascar increased from 0.6kt to 4.6kt over the same period. Material from Mozambique is mainly small and medium size flake for use in the lithium-ion battery industry, while imports from Madagascar are mainly larger size flake for use in the emerging market of expandable/expanded graphite. It should be noted that Chinaâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢s Mozambican imports did decline slightly in June 2019, however, the first downward movement in six months.

 

Syrah Resources is responsible for almost all production in Mozambique and aims to continue its ramp up of production though H2 2019, with aims to double 2019 production from the 104kt output in 2018. The producer has already reported 48kt of flake concentrate shipments in Q1 2019 and 53kt in Q2 from its Balama operation. With demand currently growing more slowly than anticipated, this extra supply is expected to push prices even lower through the remainder of 2019 and 2020. Lower demand is a result of revisions to Chinese electric vehicle incentives since the start of the year, which have begun to negatively impact demand for lithium-ion batteries and their raw materials.

 

Roskillâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢s longer term price forecasts out to 2029 are more positive, however, as significant growth in demand for flake graphite from batteries outpaces supply from the ramp-up of current producers. Price recovery will depend on the ability for new producers to open new supply in a timely fashion and on other factors, not least, the potential for further environmental closures in China.

https://roskill.com/news/graphite-flake-pri...2%80%8afor-now/

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Vidalia is the place where SYR's BAM site is located. SYR's BAM wastewater was accepted by the Vidalia Council to be added to their existing sewerage system - they said the system it could handle it The system was built to process 1.5 m gallons of wastewater but was actually processing 2.2 mg with added seepage and flood waters. Appears now the council are seeking help with funds for upgrades and repairs to the wastewater system.. Approx $5.4 mil is needed. They also want approval to pump water out to the Mississippi River at a higher capacity

 

https://m.natchezdemocrat.com/2019/08/15/vi...tewater-system/

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  • 2 weeks later...

Hiring a Technical Manager for BAM site - advertised 2 days ago - will need to hit the deck running to "ensure first product is dispatched by end of Q3 2019" - that's 32 days away and assuming he/she starts immediately

Syrah Resources LtdVidalia, Louisiana, United States

2 days ago30 applicants

 

ABOUT THE ROLE

 

A unique opportunity exists for an experienced Technical Manager to join the BAM team based in Vidalia, Louisiana, on a permanent fulltime basis. This role is responsible for providing strong leadership and technical engineering support to ensure the first purified spherical graphite product is dispatched by the end of Q3 2019 and to manage product optimization projects into operations. The successful applicant will gain invaluable career exposure to the rapidly evolving battery industry within an exciting and diverse organization.

 

Employee Benefits associated with this role include healthcare, vision plan, dental plan, retirement plan contribution matching, long term disability insurance, basic life insurance, PTO and floating holidays.

 

Nice benefits BTW - wonder if the workers in Moz get the same?

 

https://www.linkedin.com/jobs/view/technica...-ltd-1404148874

 

Total short positions @ 23/8/19 = 14.49%

https://www.shortman.com.au/stock?q=SYR

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