Advances in Processing Technology Expand Markets for Natural Graphite

LONDON -

- Roskill Information Services

- The Economics of Natural Graphite (7th Edition)

- www.roskill.com/reports/natural

Over the last decade, the development of thermal and chemical processes to produce high-purity natural graphite has enabled a more effective use of graphite resources, as lower grade ores and fines can be transformed into grades suitable for use in demanding applications such as batteries. Markets previously lost to synthetic graphite, such as batteries and carbon parts now offer opportunities for growth.

High-grade graphite can be further processed by means of intercalation and thermal shock to produce expanded graphite. Materials such as graphite foil, based on expanded graphite, now form the fastest growing end-use sector for graphite. It is characterised by low-volume, high-value applications including gaskets and seals, heat sinks and bipolar plates for fuel cells and flow batteries.

Consumption in refractories linked to recovery in Asian steel production

Refractories remain the most important end use in terms of volume, accounting for around 33% of total global demand for natural graphite. The main driver for growth in demand for graphite-containing refractories has been increasing steel production in Asia, particularly China. Future growth in this sector is unlikely to track recovering steel output as unit consumption of refractory material per tonne of steel is falling in both China and the CIS as new steel mills are installed.

Growing demand for use in batteries and fuel cells

The use of natural graphite in batteries has increased, partly as a result of increased availability of high-purity, high-carbon grades, and partly because of increased output of lithium-ion batteries, which use graphite in the anode. Graphite is used in a number of fuel cells under development; the greatest potential for a significant increase in consumption lies with the Proton Exchange Membrane cell for use in automotive and stationary power sources.

Chinese mine production slows

China is by far the largest producer and consumer of natural graphite. In 2008, it accounted for around 80% of supply, although the rate at which mine production has grown has slowed to 1.6%py since 2001. In contrast, output in Brazil, Sri Lanka and North Korea has increased at higher rates ranging from 3.5%py to over 6%py. Increasing demand for flake graphite has led to a number of potential developments outside China that could add a total of 70,000tpy to global supply.

Chinese production is still characterised by a large number of small companies but larger producers are emerging in both Heilongjiang and Hunan. There are now seven Chinese companies capable of producing more than 30,000tpy of natural graphite. Increasing regulation of mine safety and plant emissions, together with the imposition of export taxes and permits is likely to lead to further consolidation. Existing and anticipated restrictions in the availability of Chinese graphite in the world market have encouraged foreign producers and processors to invest in production bases in the country.

Asia accounts for over 70% of demand.

This region is set to increase in importance for natural graphite as Chinese consumption is forecast to increase by 8%pa from 2010. Much of this will be linked to a recovery in steel output, but increasing availability of high-purity grades will feed into China’s fast growing battery industry. Consumption of graphite in reactor components and nuclear control rods will increase as new reactors are brought online.

Rising production costs will feed through to prices in the medium term

After a decade in which the average value of exports of Chinese natural graphite showed a slow but steady decline, prices increased in 2007, following the introduction of an export tax and rising energy and transport costs. This upward trend continued in 2008 and while prices fell back slightly in response to recessionary conditions in 2009, they are expected to recover to an average of US$840/t by 2010. In the medium term, rising production costs, including the cost of complying with environmental controls, will exert an upward pressure on prices.

1 Summary 1 2 Geology and resources 6 2.1 Geology 6 2.2 Properties and uses 8 2.3 Reserves and resources 9 3 Processing of natural graphite 12 3.1 High-purity natural graphite 13 3.2 Expandable/expanded graphite 14 4 Review of world production of natural graphite 16 4.1 Structure of the natural graphite industry 20 4.2 Recycling of natural graphite 24 5 Review of production and processing by country and company 26 5.1 Australia 26 5.1.1 Potential producers of natural graphite in Australia 26 5.1.1.1 Strategic Energy Resources (SER) 26 5.1.1.2 Munglinup deposit 27 5.2 Austria 27 5.2.1 Producers of natural graphite in Austria 27 5.2.1.1 Grafitbergbau Kaisersberg 27 5.3 Brazil 28 5.3.1 Producers of natural graphite in Brazil 30 5.3.1.1 Extrativa Metalquimica 30 5.3.1.2 Grafita MG 30 5.3.1.3 Nacional de Grafite 31 5.3.1.4 Others 32 5.4 Canada 33 5.4.1 Producers of natural graphite in Canada 34 5.4.1.1 Eagle Graphite 34 5.4.1.2 Timcal Canada 35 5.4.2 Potential producers of natural graphite in Canada 36 5.4.2.1 Industrial Minerals Canada 36 5.4.2.2 Fortune Graphite 36 5.4.2.3 Worldwide Graphite Producers 37 5.4.2.4 Ontario Graphite 37 5.4.2.5 Consolidated Thompson Mines 38 5.4.2.6 Iamgold 38 5.5 China 38 5.5.1 Reserves and resources of natural graphite 39 5.5.2 Production and trade 41 5.5.3 Flake graphite production 45 5.5.3.1 North-east 46 5.5.3.2 Shandong production area 47 5.5.3.3 Inner Mongolia, Shanxi and Hebei area 47 5.5.4 Amorphous graphite production 48 5.5.5 Review of producers of natural graphite in China 49 5.5.5.1 Changzhou Timcal Graphite 53 5.5.5.2 Heilongjiang Aoyu Graphite Group 53 5.5.5.3 Hubei Hengda Graphite Shareholding 53 5.5.5.4 Hunan Chenzhou Lutang Crystallitic Graphite & Carbon 53 5.5.5.5 Hunan Chenzhou Lutang Graphite Mine No.2 Plant 54 5.5.5.6 iCarbon 54 5.5.5.7 Jixi Hengnai Graphite 54 5.5.5.8 Jixi Jinyu Graphite 55 5.5.5.9 Jixi Liumao Graphite Resources 55 5.5.5.10 Jixi Tiansheng Nonmetal Industry 55 5.5.5.11 Luoyang Guanqi Industrial & Trade 55 5.5.5.12 Luobei Qingdao Haida Graphite 56 5.5.5.13 Luobei Yixiang Graphite 56 5.5.5.14 Qingdao Guyu Graphite 56 5.5.5.15 Qingdao Haida Graphite 56 5.5.5.16 Qingdao Haili Graphite Carbon 57 5.5.5.17 Qingdao Heilong Graphite (Qingdao Black Dragon Graphite) 57 5.5.5.18 Qingdao Henglide Graphite 58 5.5.5.19 Qingdao Hensen Graphite 58 5.5.5.20 Qingdao Jinhui Graphite 59 5.5.5.21 Qingdao Kropfmuhl Graphite 59 5.5.5.22 Qingdao Super Graphite 60 5.5.5.23 Qingdao Tianhe Graphite 60 5.5.5.24 Qingdao Tiansheng Graphite 60 5.5.5.25 Qingdao Tianzhuang Hengyuang Graphite 60 5.5.5.26 Qingdao Yanxin Graphite 61 5.5.5.27 Qingdao Zhongdong Graphite 61 5.5.5.28 Timcal Jing Yuan Graphite (Baotou) 61 5.5.5.29 Yichang Xincheng Graphite 62 5.5.6 Future areas of natural graphite production in China 62 5.5.7 Beneficiation of natural graphite in China 62 5.5.7.1 BTR New Energy Materials (BTR) 64 5.5.7.2 Changsha Hairong Electronic Materials 64 5.5.7.3 Hunan Huiyu Science & Technology 64 5.5.7.4 Liaoning Hongguang Technology 64 5.5.7.5 Tianjin Tiecheng Battery Material 64 5.5.7.6 Shanghai Shanshan Science and Technology 65 5.5.8 Traders of natural graphite in China 65 5.6 Czech Republic 65 5.6.1 Producers of natural graphite in the Czech Republic 67 5.6.1.1 Grafitove doly Stare Mesto 67 5.6.1.2 Graphite Tyn spol 67 5.6.1.3 Koh-I-noor Grafit 67 5.7 France 68 5.7.1 Processors of natural graphite in France 68 5.7.1.1 Carbone Lorraine 68 5.7.1.2 Carbone Savoie 68 5.8 Germany 68 5.8.1 Producers of natural graphite in Germany 69 5.8.1.1 Graphit Kropfmuhl 69 5.8.1.2 Carl Nolte Sohne 71 5.8.1.3 Georg H Luh 72 5.8.1.4 Sigri Great Lakes Carbon (SGL Carbon) 72 5.8.1.5 Others 72 5.9 Greece 73 5.1 India 73 5.10.1 Producers of natural graphite in India 76 5.10.1.1 Agrawal Graphite Industries (AGI) 77 5.10.1.2 GR Graphite Industries 77 5.10.1.3 Lakshminarayan Makhanlal (LMCO) 77 5.10.1.4 Tamil Nadu Minerals (TAMIN) 78 5.10.1.5 TP Mineral Industries (TPMI) 78 5.10.1.6 Graphite India (GIL) 79 5.10.1.7 HEG 79 5.10.1.8 Others 79 5.10.1.9 Beneficiation of natural graphite in India 79 5.11 Italy 80 5.12 Kazakhstan 81 5.13 North Korea 81 5.14 South Korea 82 5.15 Madagascar 83 5.15.1 Producers of natural graphite in Madagascar 84 5.15.1.1 Etablissements Gallois 84 5.15.1.2 Etablissements Rostaing 84 5.15.1.3 Others 84 5.15.2 Potential producers of natural graphite in Madagascar 85 5.16 Mexico 85 5.16.1 Producers of natural graphite in Mexico 86 5.16.1.1 Grafito Superior 86 5.16.1.2 Grafitos Mexicanos 86 5.16.1.3 Others 86 5.16.1.4 Grafito de Mexico 86 5.17 Mongolia 87 5.18 Mozambique 87 5.18.1 Potential producers of natural graphite in Mozambique 87 5.18.1.1 Timcal Graphite and Carbon 87 5.19 Namibia 88 5.2 Norway 88 5.20.1 Producers of natural graphite in Norway 88 5.20.1.1 Skaland Graphite 88 5.21 Peru 89 5.22 Romania 89 5.23 Russia 90 5.23.1 Producers of natural graphite in Russia 91 5.23.1.1 Krasnoyarskgraphit 91 5.23.1.2 Uralgraphite 91 5.23.2 Potential producers of natural graphite in Russia 91 5.23.2.1 Prominvest 91 5.24 Sierra Leone 91 5.25 Slovakia 92 5.26 Spain 92 5.27 South Africa 92 5.28 Sri Lanka 92 5.28.1 Producers of natural graphite in Sri Lanka 94 5.28.1.1 Bogala Graphite Lanka 94 5.28.2 Potential producers of natural graphite in Sri Lanka 95 5.28.2.1 Kahatagaha Graphite Lanka (KGLL) 95 5.28.2.2 RS Products 95 5.29 Sweden 95 5.29.1 Potential producers of natural graphite in Sweden 96 5.29.1.1 Mirab Mineral Resurser 96 5.29.1.2 Tricorona 96 5.29.2 Processors of natural graphite in Sweden 96 5.29.2.1 Minelco Group 96 5.3 Switzerland 97 5.30.1 Processors of natural graphite in Switzerland 97 5.30.1.1 Timcal Graphite and Carbon 97 5.31 Tanzania 98 5.32 Turkey 98 5.32.1 Producers of natural graphite in Turkey 98 5.32.1.1 Karabacak Metal and Mining 98 5.33 Ukraine 98 5.33.1 Producers of natural graphite in Ukraine 99 5.33.1.1 Zavalyevsky (Zaval’evsky) Graphite Complex 99 5.34 United Kingdom 100 5.34.1 Processors of natural graphite in the UK 100 5.34.1.1 Branwell Graphite 100 5.34.1.2 James Durrans Group 100 5.34.1.3 Morgan Crucible 101 5.35 USA 101 5.35.1 Processors of natural graphite in the USA 102 5.35.1.1 Acheson Industries 102 5.35.1.2 Asbury Carbons 102 5.35.1.3 GrafTech International 103 5.35.1.4 iCarbon 104 5.35.1.5 Poco Graphite 105 5.35.1.6 Superior Graphite 105 5.36 Uzbekistan 106 5.37 Vietnam 107 5.38 Zimbabwe 108 5.38.1 Producers of natural graphite in Zimbabwe 108 5.38.1.1 Zimbabwe German Graphite Mines 108 6 International trade 109 6.1 Exports of natural graphite 109 6.2 Imports of natural graphite 120 7 World consumption of natural graphite 129 7.1 Consumption of natural graphite in China 130 7.2 Consumption of natural graphite in the USA 131 7.3 Consumption of natural graphite in other countries 135 8 End-uses of natural graphite 138 8.1 Refractories 141 8.1.1 Natural graphite-containing refractories 147 8.1.1.1 Magnesia-carbon refractories 147 8.1.1.2 Alumina-carbon refractories 148 8.1.1.3 Silicon carbide-graphite refractories 149 8.1.2 Production of crude steel 149 8.1.3 Steel-making processes 155 8.1.4 Refractory manufacturers 157 8.1.4.1 ANH Refractories 157 8.1.4.2 GrafTech International 158 8.1.4.3 Imerys 158 8.1.4.4 Linco Baxo Group 159 8.1.4.5 Magnesita 160 8.1.4.6 Morgan Crucible 161 8.1.4.7 Preiss-Daimler Group 161 8.1.4.8 Refratechnik 161 8.1.4.9 RHI Group 163 8.1.4.10 Saint-Gobain Ceramics 164 8.1.4.11 Shinagawa Refractories 164 8.1.4.12 Tata Refractories (TRL) 164 8.1.4.13 Vesuvius Group 165 8.1.5 Magnesia-carbon brick manufacturers 166 8.1.6 Crucibles 169 8.2 Recarbursing in steel-making 170 8.3 Powder metallurgy 172 8.3.1 Ultra-hard alloys 175 8.4 Foundry and forging applications 176 8.5 Carbon-graphite composites 177 8.6 Lubricants 180 8.7 Pencils 182 8.8 Batteries 183 8.8.1 Primary batteries 185 8.8.1.1 Alkaline batteries 187 8.8.1.2 Zinc-carbon batteries 187 8.8.1.3 Primary battery manufacturers 189 8.8.2 Secondary batteries 189 8.8.2.1 Lithium-ion/polymer batteries 192 8.8.2.2 Production of secondary batteries 192 8.8.2.3 Lithium secondary battery manufacturers 194 8.8.3 Demand for lithium secondary batteries 194 8.8.3.1 Demand for lithium secondary batteries for portable goods 195 8.8.3.2 Demand for lithium secondary batteries for transport 196 8.8.3.3 Demand for lithium secondary batteries for other applications 200 8.8.4 Fuel cells 200 8.8.4.1 Applications for fuel cells 203 8.9 Friction materials 204 8.1 Flexible graphite products 211 8.10.1 Flexible graphite manufacturers 212 8.11 Carbon-graphite foam 215 8.12 Other uses for natural graphite 216 8.12.1 Rubbers and plastics 216 8.12.2 Paint 216 8.12.3 Nuclear 216 9 Alternatives to natural graphite 218 9.1 Synthetic graphite 218 10 Future demand for natural graphite 221 10.1 Refractories 221 10.2 Batteries and fuel cells 223 10.3 Friction materials 225 10.4 Flexible graphite products 225 10.5 Nuclear 226 11 Prices of natural graphite 227 11.1 China 230 11.2 USA 233 11.3 Future price trends 233

Prakash Ramachandran, Marketing Manager, Tel +44-20-8944-0066, Email: prakash@roskill.co.uk

Source: Roskill Information Services

Prakash Ramachandran, Marketing Manager, Tel +44-20-8944-0066, Email: prakash at roskill.co.uk