Australian mining company Syrah announced on Tuesday that it produced 15,000 tonnes of graphite for electric car batteries in April, which it exports from Cabo Delgado, northern Mozambique, having halted production the following month due to international stockpiles.
“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 availability of finished product stock,” said the second quarter activity report, released on Tuesday by Syrah and in which it estimates costs of US$4 million (€3.5 million) for each month of closure at that unit.
The Australian mining company’s production in Cabo Delgado had risen to 41,000 tonnes of natural graphite in the first quarter of this year, compared to 35,000 tonnes in the previous quarter, above sales, which rose from 28,000 to 30,000 tonnes.
In today’s information, the company also justified the decision to suspend production in May with the need to dispose of the current stock of 28,000 tonnes while waiting for an “improvement” in market demand conditions for natural graphite, also admitting the impact on global synthetic graphite production.
“The decision to restart production will depend on increased sales of the stock and new sales orders at prices above operating costs in production volumes of at least 10,000 tonnes per month, in accordance with the review of the mode of operation at Balama,” said the document, in which Syrah acknowledges that the requests and proposals received for that production “have not yet reached that level”.
Syrah was one of the mining companies whose operation was affected by the armed conflict in Cabo Delgado.
In June 2022, the supply chain was temporarily suspended due to attacks that came close to the road the graphite is shipped out on.
In November, the mine’s facilities had to be evacuated due to violence in the neighbourhood.
The mining company had been progressively recovering production at the Balama unit and, in April, operated “uninterruptedly”, although still at “approximately 50% of capacity”.
“The company is focused on strengthening plant reliability and identifying and implementing operational efficiencies during the pause in production,” Syrah added.
The Australian firm is also building its own Vidalia battery material plant in the US, which will be fed with ore from Mozambique, in this case with two tonnes shipped in April.
Lusa
