The Mozambican government, through the Ministry of Mineral Resources and Energy (MIREME), admitted this Wednesday, 23 August, that the decision by the Australian mining company Syrah Resources to suspend graphite production in the country compromises the quantity and revenue targets that the state had projected.
On 18 July, the Australian mining company Syrah Resources announced that it would produce 15,000 tonnes of graphite in April for electric car batteries, which it would export from the Balama district in Cabo Delgado province, northern Mozambique. However, this production was interrupted the following month due to stocks and prices on the international markets.
“Operations at the Balama [Nacala/Pemba] plant were interrupted, resulting in no production in May and June 2023, due to volatility in the Chinese anode market and good stock availability of finished products,” reads the second quarter activity report released by Syrah Resources, in which it estimates costs of four million dollars for each month of closure at that unit.
Speaking to Lusa, the national director of Geology and Mines, Cândido Rangeiro, pointed out that the measure could jeopardise this year’s graphite production projections and the revenue for the state generated by this ore.
“We are saddened by this, because we actually had projections for graphite production and this target will probably not be reached,” emphasised Rangeiro.
Without specifying figures, he said that the impact could be “considerable”, bearing in mind that Syrah Resources is the largest graphite producer in Mozambique, ahead of Gk Ancuabe Graphite Mine, which exploits this resource in the Ancuabe district, also in Cabo Delgado.
“This company [GK] has not communicated any stoppage to us, perhaps because it produces for a parent company that is in Germany, and it has not instructed its subsidiary in Mozambique about any decision regarding its operation in the north,” he added.
Welcoming the fact that Syrah’s decision had no impact on jobs, Cândido Rangeiro pointed out that the dynamics of the international raw materials market are characterised by fluctuations in demand and supply.
“Today we are facing this situation and tomorrow I believe it will change,” he emphasised.
The Balama mine began commercial production four years ago and was in the spotlight in December when Syrah announced an agreement with electric vehicle multinational Tesla, which intends to use graphite from the mine, described as one of the largest deposits of this type of “quality” ore in the world by the Australian company itself.
