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SYR - Syrah Resources

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I think SYR will need to be very careful and strategic with its approach to developing what will be a seemingly limitless supply of high quality graphite at very competitive costs.

I just cannot see how the Chinese or indeed any other country will allow a single dominant supplier to take over the marketplace. With that in mind I think SYR will end up as a significant but not necessarily totally dominant supplier in the market. Perhaps up to 100,000 tonnes a year max.

What could change this situation would be a long term strategy of SYR to research and promote the potential of graphite and associated minerals in a range of industrial technologies. By tacitly offering a guaranteed supply at a steady price they could stimulate a range of uses that are currently at a research stage and guarantee a steadily expanding market

The other excellent opportunity SYR has are the heavy mineral sands in Tanzania. I think they could easily develop them from the early graphite cash flow and widen the profitability of the company without disrupting the overall price/supply structure of the graphite industry. Any thoughts:2twocents
 
basilio said:
Always interesting going on a learning curve with a new product.

Came across a story which offer some balance to the some of the current hype in the industry.

http://jutiagroup.com/20120529-dont-tip-the-balance-on-graphite-supply-stephen-riddle/
Click to expand...

The article suggests the market for graphite isn't exactly massive...

Generically, I’d estimate global graphite as a $13 billion (B) industry. Natural graphite, however, is a small portion of the overall market””no more than $1B.
Click to expand...

Current demand for natural-flake graphite accounts for maybe 500,000–600,000 tons (t) per year.
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It’s good that there are plenty of deposits of graphite outside of China. The world is more than covered for the next 100–200 years as demand grows for natural-flake graphite. On the other hand, most of these companies will not make it to the table because the demand won’t grow fast enough for all of them to get into the business.
Click to expand...
 
Will be interested to see how this plays out in the short term. Looks like some selling off.
 
HANG IN!
 

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SYR held up pretty well considering the run it's had. Bought more at $2 on opening and added some CSE at 17c later in the morning.
 
"We always say the drill bit is the lie detector, well the first 3 holes provides the proof that its not a fairytale so you have no excuse for missing out now. Everything else from here on is simply the stuff required to get it to reportable standards"

The above posted on another blog says it all.
 
Not much info in this thread. What do these guys actually explore for? And what is their long term goals?

3 drill holes could easily be an anomaly or a very small area. Sure they might have product, but is there enough there to mine? I have seen plenty of stocks have a few good holes and then never get anywhere after that
 
prawn_86 said:
Not much info in this thread. What do these guys actually explore for? And what is their long term goals?

3 drill holes could easily be an anomaly or a very small area. Sure they might have product, but is there enough there to mine? I have seen plenty of stocks have a few good holes and then never get anywhere after that
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Thats a very surprising comment Prawn. The three drills holes have confirmed 280 plus metres of high grade graphite. They come on the top of extensive surface trenching which confirmed high grade graphite over many kilometers.

This will be the largest graphite resource yet found. The questions now are

how quickly can it be mined;
will there be other significant competitors (including new explores);
how will the current high price of graphite hold up with such a huge resource and
what will be the response of other current graphite producers.
 
basilio said:
Thats a very surprising comment Prawn. The three drills holes have confirmed 280 plus metres of high grade graphite. They come on the top of extensive surface trenching which confirmed high grade graphite over many kilometers.

This will be the largest graphite resource yet found. The questions now are

how quickly can it be mined;
will there be other significant competitors (including new explores);
how will the current high price of graphite hold up with such a huge resource and
what will be the response of other current graphite producers.
Click to expand...

Im not saying there isn't a resource, and i dont know anything about graphite, but i am not aware of any mines that have gone ahead on 3 drill holes, so depending on the structure/layout it could still possibly not be feasible imo.

I agree with all your other questions and it isnt easy for a company to progress sucessfully from exploration to mining a resource
 
Actually had these guys mentioned (not as an investment) yesterday, so i did some reading. Yes their graphite resource has the potential to be huge, but to me they seem to be very early stages and a 300m market cap for a resource with 3 holes seems a bit extreme to me.

Plenty of co's with MC's under 300m that are turning profits, although the market isn't always rational...
 
prawn_86 said:
Actually had these guys mentioned (not as an investment) yesterday, so i did some reading. Yes their graphite resource has the potential to be huge, but to me they seem to be very early stages and a 300m market cap for a resource with 3 holes seems a bit extreme to me.

Plenty of co's with MC's under 300m that are turning profits, although the market isn't always rational...
Click to expand...

It's a bit more than three holes... the ore body breaches the surface, and on top of the (4) drill holes, they've dug something like 8 or 9 trenches at varying depths between 1m and 20m over hundreds of metres... I don't think there is a lot of doubt over the size of the ore body and while I'm sure there will be pockets of lower grade graphite in there, I think there is a fair bit of justification to support current estimates, especially given how low cost the mining process should be to get the stuff out.
 
So what sort of profits are they forecasting? And what effect would a supply that large have on the global graphite market?
 
prawn_86 said:
So what sort of profits are they forecasting? And what effect would a supply that large have on the global graphite market?
Click to expand...

I think the biggest concern at present is how long it will take to get all their mining permits in place - from what I've read it took 2 years to get their exploration permit sorted out. Presumably they still need to go through a feasibility process and get their mining license and all that, so there is a reasonably high risk that could drag along in a similar fashion.

I didn't catch SYR in time to jump on the big kick up like others here, but I did buy a few shares in CSE last week at 18c, which gives me a nice little sideline interest in it to see how things pan out. At current prices, CSE have no debt, about 3m cash in the bank and own 11m shares in SYR... so a market cap of 22m and assets of 30m and two common directors with SYR. At this stage I've got no real opinion on how well SYR will progressing to the mining stage, but have confidence that CSE will manage their asset well and cash out if there are signs of concern (based on their good decisions - and returns to shareholders (a large portion of whom are the directors) when they sold off their exploration leases last year).
 
Vader said:
I think the biggest concern at present is ...
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Hi Vader,
I feel like wading in here!

I like your postings!
Factual and balanced.

My biggest concerns are about the company being able to reach production
(they are in Mozambique!)
and then choke the supply to prevent the graphite price from crashing.

Meanwhile newbies are buying in during fevered speculation stage!
I'm not saying don't do it. I am saying be careful.
 

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