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Graphite is an important material for the electric vehicle battery industry. What are the top graphite-producing countries?

Graphite is an excellent conductor of heat and electricity and also has the highest strength of any natural material. However, it wasn’t until recently that the metal began to gain popularity, sparking investor conversations about the top graphite-producing countries.

Interest in graphite mining is increasing in large part because lithium-ion batteries are becoming more common. These batteries are used in everything from phones to electric vehicles (EVs), and graphite is one of their key raw materials. As lithium-ion battery demand grows, graphite demand is also expected to rise.

In fact, despite discussions on changes in lithium-ion battery chemistry, many experts think graphite will remain a key raw material in EV batteries for at least the next decade. Both synthetic and natural graphite, in the form of the intermediate product spherical graphite, are products that are used in the anodes of lithium-ion batteries.
According to Benchmark Mineral Intelligence, demand for graphite from the battery anode segment could increase by seven times in the next decade as surging electric car sales and the energy storage trend continue to drive the construction of lithium-ion battery megafactories.

In terms of pricing, it’s key to note that different graphite types command different prices. However, in general, supply constraints paired with increasing demand from the battery sector have helped natural graphite prices in the past few years, despite several rounds of downward price readjustments.

Looking at supply in 2021, China took the top spot for graphite production, with Brazil and Mozambique coming in second and third, respectively. For any investor following the sector, it will come as no surprise that the Asian country is leading the way — China is known to dominate both the mining and refining side of the graphite market.

Read on for a look at the top graphite-producing countries of 2021. All stats are based on the most recent data from the US Geological Survey.

1. China
Mine production: 820,000 MT

As mentioned, China was the world’s largest graphite producer in 2021. It put out 820,000 metric tons (MT) of the metal, significantly higher than the amount it produced in the previous two years. According to the US Geological Survey, the country accounted for 79 percent of world graphite mining in 2021.

China’s stranglehold on the graphite market was strengthened by its quick recovery in graphite production post-COVID-19 shutdowns. “In China, the recovery was quick, which was demonstrated by China’s pattern of exports,” notes the US Geological Survey. “Chinese producers quickly increased production after a few months of closures in 2020. This allowed China to gain a more dominant position in the market for 2021 and slowed down the diversification of the supply chain.”

2. Brazil
Mine production: 68,000 MT

Brazil was the world’s second largest graphite producer in 2021 with output of 68,000 MT during the period. Brazil’s 2021 graphite-mining output increased by 4,400 MT from 2020.

Brazil has the third highest graphite reserves by country and is the third most important battery metals jurisdiction in the world. Little information is available about the Brazilian graphite-mining industry, as the country’s top producers of the metal are private. However, the nation has become a hot spot for graphite exploration and development. One such project is South Star Battery Metals' (TSXV:STS,OTCQB:STSBF) Santa Cruz large-flake graphite property, where commercial production is planned for Q4 2022.

3. Mozambique
Mine production: 30,000 MT

Mozambique takes the third spot on the list with graphite output of 30,000 MT in 2021. The country is home to two main graphite miners: Syrah Resources (ASX:SYR,OTC Pink:SYAAF) and Triton Minerals (ASX:TON).

The US Geological Survey states, “A graphite mine in Mozambique in a high-grade graphite deposit was reportedly the largest natural graphite mine globally. The mine was expected to operate for about 50 years.”

4. Russia
Mine production: 27,000 MT

In 2021, Russia’s graphite output clocked in at 27,000 MT, up 2,000 MT from 2020. The country, previous to the Russia/Ukraine War, was expected to significantly increase its production during the next several years due to the implementation of two investment projects, Dalgraphite and Uralgraphite. As with many of the countries on this list, little further information is available on graphite mining in Russia.

5. Madagascar
Mine production: 22,000 MT

Madagascar produced much less graphite than the four top graphite-producing countries in 2021, but it’s still the world’s fifth largest producer of the metal and has the third largest graphite reserves. According to the US Geological Survey, large graphite deposits are being developed in this island country in the Indian Ocean.

Growth in Madagascar’s graphite-mining industry includes new projects with the potential to come online in the near future, including NextSource Materials' (TSX:NEXT,OTCQB:NSRCF) Molo graphite project, which is currently in construction with commissioning expected in Q3 2022.

6. Ukraine
Mine production: 17,000 MT

Ukraine, another top graphite-producing country, put out 17,000 MT of graphite in 2021, slightly higher than 2020’s 16,000 MT. Zavalievskiy Graphite is a large producer in the country. According to its website, it’s been in operation since 1934 and has production capacity of up to 30,000 MT of natural flake graphite per year. Russia’s war in Ukraine will no doubt have a massive impact on the country’s graphite production in 2022 and beyond.

7. Norway
Mine production: 13,000 MT

Norway’s graphite-mining output rose narrowly from 12,000 MT in 2020 to 13,000 MT in 2021. All graphite deposits in the country contain flake graphite and are generally low tonnage. That said, many are in favorable locations — for example, close to the sea or to the electrical grid.

8. Canada
Mine production: 8,600 MT

Canada’s graphite production rose by 600 MT in 2021, coming in at 8,600 MT. Interest in Canada as a source of graphite has been rising for the past few years, particularly since Tesla (NASDAQ:TSLA) said it plans to source the lithium, graphite and cobalt it needs for its Nevada-based lithium-ion battery gigafactory from North America.

9. India
Mine production: 6,500 MT

India’s graphite output last year came to 6,500 MT, only 500 MT higher than 2020's amount. The country’s reserves vary widely from state to state, with Arunachal Pradesh holding nearly half of India’s graphite reserves.

The graphite-mining country has eight main producers, including Tirupati Carbons & Chemicals, Chotanagpur Graphite Industries and Carbon & Graphite Products. HEG (NSE:HEG,BSE:509631) is a leading, although small-scale, graphite electrode producer in India.

10. Sri Lanka
Mine production: 4,300 MT

Sri Lanka’s total graphite output last year came to 4,300 MT, marginally higher than the amount it put out in 2020. The country's reserves of the commodity stand at 1.5 million MT, and it is the only jurisdiction in the world where the rarest form of graphite, vein graphite, is mined.

Vein graphite has many uses in advanced, thermal and high-friction applications, as well as applications that require high thermal and electrical conductivity properties.  - INN-