Electric car giant Tesla has reached an agreement with Australian supplier Syrah Resources to purchase graphite from mines in Mozambique from Syrah's Louisiana processing plant, foreign media reported. Analysts believe the main purpose of the deal is to reduce dependence on Graphite from China.
Graphite is a key component of electric vehicle batteries. Under the agreement, Tesla plans to buy 8,000 tons of graphite a year from Syrah's Louisiana plant starting in 2024. Simon Moores of Benchmark Mineral Intelligence sees tesla's deal as an attempt to increase its ability to make batteries and reduce its dependence on China. Because China dominates the global graphite market.
The biggest constraint will be whether Tesla can procure enough batteries for the nearly 1 million electric cars it produces each year. Sam Abuelsamid, chief electric vehicle analyst at U.S. energy consultancy Guidehouse Insights, said Tesla's deal was meant to ensure a steady supply of battery materials, which are relatively scarce, in anticipation of rising demand for electric vehicles. (Proofreading/Novation)