Fall in Chinese demand halts Syrah supply
PERTH (miningweekly.com) – Declining demand from China during the March quarter has seen graphite miner Syrah Resources reporting declines in both production and sales for the three months under review.
Syrah on Wednesday noted that graphite production from its Balama operation, in Mozambique, reached 12 000 t during the quarter under review, down from the 15 000 t produced in the December quarter.
Graphite sales for the quarter were also down to 7 000 t, from the 17 000 t sold in the previous quarter, while the average weighted price for graphite increased slightly from $458/t to $478/t.
The miner told shareholders that production and shipments for the quarter remained low as prevailing demand in China was negatively impacted by the Covid-19 pandemic.
Syrah was forced to temporarily suspend production at Balama at the end of March owing to the impact of Covid-19 on the domestic and international mobility of the project’s workforce. The company said that the suspension of operations had been undertaken in an orderly manner with preservation of optionality to promptly restart operations.
Production at Balama is likely to remain suspended for the duration of the second quarter.
The ASX-listed Syrah has suspended its production guidance for the full year on the back of operational and market uncertainty in the wake of Covid-19.
The company on Wednesday said that it expected the demand- and supply-side shocks associated with Covid-19 to normalise over time, however, it noted that the rate of this normalization was currently uncertain given the lockdown measures that remained in place in its key geographies.
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