- Lomiko Metals Inc. (TSXV:LMR) stressed the need to ensure a secure and responsibly sourced graphite supply in North America
- China plans to limit and restrict graphite exports while maintaining a dominant position in global graphite production
- According to Benchmark Mineral Intelligence’s flake graphite forecast report, the shortfall is expected to increase to 8 metric tons by 2040
- Lomiko Metals Inc. last traded at $0.02 per share
China’s plans to limit and restrict graphite exports underlines the importance of developing Canadian projects.
This comes from domestic miner Lomiko Metals Inc. (TSXV:LMR) who stressed the need to ensure a secure and responsibly sourced supply in North America.
According to Benchmark Mineral Intelligence’s flake graphite forecast report, the shortfall is expected to increase to 8 metric tons by 2040. The company added that the graphite supply shortage has already begun, and work needs to be done to accommodate the growth of the Electric Vehicle (EV) market.
This is driven by the increasing demand for electric vehicle batteries, which is surpassing other applications of the material. Global EV sales are on the rise, as reported by the International Energy Agency (IEA) earlier this year, sales exceeded 10 million units in 2022, marking a 55 per cent increase compared with 2021, and are projected to reach nearly 14 million vehicles this year. Last year, the IEA reported that 26 million EVs are on the road, and half of those are in China. Now automakers are actively seeking alternative sources of graphite outside of China. According to the U.S. Geological Survey, Mineral Commodity Summaries from January 2023, the market for graphite used in batteries had grown 250 per cent globally since 2018.
China maintains a dominant position in global graphite production, with the U.S. completely dependent on the importation of graphite and anode materials.
China has declared its intent to implement export permits for certain graphite products in the name of safeguarding national security. This move is part of China’s broader scheme to regulate the supply of critical minerals in response to challenges to its manufacturing dominance. The Ministry of Commerce and the General Administration of Customs clarified that it was not targeting any particular country with the restrictions stating that the top graphite buyers from China include the U.S., South Korea, Japan and India.
These restrictions include natural flake graphite and synthetic graphite and are set to take effect starting Dec. 1.
Lomiko Metals’ CEO, Belinda Labatte said in a media release that this announcement from China emphasizes the need to build local and resilient supply chains in Canada and North America to meet supply needs and decrease foreign dependency.
“We are looking to advance several pre-feasibility level initiatives and continue partnerships with universities in Québec,” she said. “Advancing Canadian projects is a North American solution to minimize geopolitical risks. Lomiko is now focused on Pre-Feasibility (PFS) level metallurgical studies with NRC IRAP and funding from CRITM, through the Québec Plan for the Development of Critical and Strategic Minerals from Ministère des Ressources naturelles et des Forêts (MRNF). These studies involve the research and development of a technological prototype for graphite processing, comprising several stages, including flotation testing, micronization, spheronization, purification and coating of the flotation concentrate prior to coin and pouch battery testing. Lomiko’s recent studies have shown that it has a product amenable to the anode market, as well as other industry segments.”
To build on the company’s results over the past 18 months, additional PFS studies are required, and the company is currently looking at sources of funding, including government grants.
Lomiko Metals Inc. is developing its 100-per-cent-owned La Loutre graphite deposit, 180 km northwest of Montreal, and is working towards earning a 70 per cent stake in the Bourier lithium project in the James Bay region of Québec.
Lomiko Metals Inc. last traded at $0.02 per share.
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