Supply Chain Risks Loom as Evion Expands Graphite Exports to US and EU

Strategic Milestone in Graphite Supply

Evion Group NL (ASX – EVG) has marked a significant operational milestone with the first shipments of expandable graphite dispatched from its 50/50 joint venture, Panthera Graphite, near Pune, India, to the United States. This initial delivery has generated approximately A$400,000 in cash for the JV, underscoring the commercial viability of Evion’s supply chain into a critical market.

Managing Director David Round highlighted the strategic importance of these shipments, noting that they come at a time when global graphite supply chains are under pressure due to export restrictions from China. Evion’s ability to provide a reliable, non-Chinese source of expandable graphite positions it well to meet growing demand in the US and Europe, particularly for sectors reliant on critical minerals.

Rising Demand and Supply Constraints

The global graphite market is experiencing significant supply shortages, driven largely by Chinese export limitations. Prices for both graphite concentrate and expandable graphite have risen sharply, with concentrate prices from East Africa and Madagascar now 20-30% higher than previous Chinese benchmarks. Evion’s JV has responded by securing over 450 tonnes of graphite concentrate, valued at more than A$1 million, to underpin production and future sales.

This inventory build supports Evion’s Stage 2 upgrade plans, aimed at expanding production capacity to meet anticipated demand. The company’s stable margins amid rising prices reflect operational efficiencies and strategic sourcing, providing a solid financial foundation for growth.

EU Recognition and Strategic Positioning

Evion’s recognition by the European Union as a preferred supplier of graphite concentrate and materials is a critical endorsement. The EU has identified graphite as a vital critical mineral essential for military, aerospace, electric vehicle, energy storage, and electronics applications. This designation accelerates permitting processes and enhances financing opportunities, positioning Evion as a key player in securing Europe’s supply chain resilience.

Evion’s vertically integrated approach, with projects spanning Madagascar, India, and Europe, including a Battery Anode Material plant in Germany, further strengthens its strategic footprint. The Maniry Project in Madagascar, with a substantial high-grade graphite resource, complements the JV’s production capabilities and supports the company’s long-term growth ambitions.

Looking Ahead

With ongoing negotiations for forward contracts in the US and Europe, Evion is poised to establish regular and reliable supply agreements. The company’s focus on expanding production capacity and securing inventory positions it well to capitalize on the tightening global graphite market. However, the evolving geopolitical landscape and supply chain dynamics will require careful navigation to sustain momentum.