China graphite producer wants govt protection “likChina graphite producer wants govt protection “like rare earths”
28 February 2012
Industry needs investment into processing graphite; curb unsustainable practice
Heilongjiang Aoyu Energy Technology Co., the largest producer of graphite in China, last week called for the state
to afford the same controls to graphite markets as it has to rare earths.
The company joined others in complaining that unsustainable practices in China will have an adverse affect on the
industry.
“After three years of effort the market and the price is still basically stable,” the company outlined in a release,
blaming the stable price on illegal mining.
“Respective regions with graphite reserves are mining (...) this is a serious waste of scarce valuable resources and
makes for price competition (...) the demand for graphite is limited, with a national demand of 70m tonnes.”
The company said it is requesting that the national government “at all levels” curb the recent phenomena of illegal
mining of graphite and processing.
Rare earths
The Chinese government needs to protect the graphite in the same way it has protected rare earths, Heilongjiang
Aoyu Energy Technology Co. added.
The company said that it has heard of graphite being sold into Japan, where it is processed and purified and then
sold back into China at a higher price, which can be up to 30 times higher than the feedstock level.
Chinese graphite accounts for 72% of global output in the world, producing 600,000 tpa in 2011, according to the
US Geological Survey (USGS). Heilongjiang province is the largest graphite-producing region in China, accounting
for 64% of production.
Processing lag
China still lags behind when it comes to processing, although now companies in China have not only start to mine
the graphite, but also start processing projects.
“We have been in the graphite business for 20 years, now what we are thinking is that we cannot let high profit slip
away for nothing, and we must overcome every difficulty to do further processing ourselves,” Han Yufeng,
president of Heilongjiang Aoyu Graphite Group, told reporters at China Chemical Industry News.
Aoyu Graphite started to operate Guangxia New Material Brick Co. Ltd in 2010 and has since expanded to
encompass six processing arms.