GreenRoc Mining PLC (AIM:GROC) belatedly joined the graphite party as it put out a statement highlighting the implications of China’s new restrictions on battery-grade supplies of the carbon-based material.
Shares in the group jumped 18% to 4.15p as it pointed to the boost the move might give to its Amitsoq project in South Greenland, which is due to come on stream in the next few years.
China's new rules are scheduled to take effect by 1 December 2023, and demand Chinese graphite companies seek special export permits to supply international battery manufacturers.
“Notably, the export curbs encompass both synthetic and natural flake graphite, as well as graphite concentrate and purified graphite,” said GreenRoc, though lower-grade graphite intended for conventional applications such as steel are not included.
“China is the primary source of over 70% of global synthetic graphite production and approximately 65% of natural flake graphite.
“Moreover, China also processes more than 90% of graphite which is used in electric vehicle (EV) battery anodes,” it noted.
In Europe alone, the demand for battery-grade graphite is estimated to reach one million tonnes by 2030, equivalent to the entire global graphite production in the year 2020.
Stefan Bernstein, GreenRoc's chief executive, commented: “This selective targeting creates a substantial risk that ongoing actions to replace internal combustion engine vehicles with EVs will be slower and more expensive given that today no EVs can be manufactured without relying on battery grade graphite from China.
“Moreover, this move by China will bolster the competitive advantage of Chinese electric vehicle manufacturers.
"In response, the rest of the world, including Europe and North America, must accelerate the development of their own upstream industries in the critical mineral space.
"The publication of GreenRoc's Amitsoq project's preliminary economic assessment (PEA) next week represents an important milestone in the development of Amitsoq and, in the context of China's export restrictions, could not be timelier.”
Tirupati Graphite, which put out its response to China’s move yesterday, was up another 20% at 21p today for a two-day gain of 50%, while Blencowe added another 10% to 5.25p. Sovereign Metals was unchanged at 21p.