OTTAWA (Nov. 22, 2013) — The dynamics of the global graphite industry are changing and they bode well for Focus Graphite and our shareholders. All indicators point to China’s inward-looking industrial policies as the catalyst that influences future market supply.
China’s intentions to move to a consumer state from an exporting economy will have an enormous, positive impact on emerging flake graphite producers – especially those of us who’ve structured their businesses to capture high-value contracts.
The consolidation of China’s amorphous industry and pending consolidation of the flake graphite sector intends to raise mining standards with a view to creating high-value graphite processing and purification facilities to meet its voracious domestic demand for technology-grade products. China wants to export finished goods, not raw materials.
This being the case, Focus is well-positioned to meet the challenges ahead and reap the benefits that come from a return to pre-recession pricing and more, providing an opportunity for FMS to compete for technology graphite supply contracts globally, including China.
Our long-stated goal is to become one of the lowest cost producers in the world.
Lac Knife’s 16% graphite concentration provides us with an advantageous commercial foundation compared to most producers, and our high-grade resource, yielding high grade flake concentrate, enables potential cost-savings at the purification and value-added stages.
It is important to remember that our planning envisions Lac Knife’s mine production start-up by mid-2016 – coinciding with an anticipated spike in demand for industrial and high-tech graphite from all sectors, including the battery sector.
Today, our technical, regulatory and administrative actions to meet or beat that target date are well underway.
Discussions with strategic offtake partners are nearing finalization and we anticipate the announcement of our mine and plant financing will play some role in returning the investor spotlight back on Focus Graphite.
As the officer responsible for bringing Lac Knife to production, I can state without reservation that Lac Knife’s high-grade, high-purity resource holds all the potential to lead us through to the next industrial cycle of sustainable growth and profitability.
President and Chief Operating Officer