Syrah Resources has resumed production at its Balama graphite mine after a year-long halt and is advancing sales at its US Vidalia anode material facility, supported by new US tariffs on Chinese imports and a $70 million equity raise.
- Balama graphite production recommenced with strong operational metrics
- Vidalia Active Anode Material facility progressing customer qualifications, sales expected this year
- US Department of Commerce imposes steep antidumping and countervailing duties on Chinese imports
- Syrah raises approximately US$46 million to fund Vidalia operations and corporate expenses
- Loan forbearance agreements secured with US DOE and extended waivers with DFC
Balama Production Resumes After Community Disruption
Syrah Resources Limited has successfully restarted operations at its flagship Balama Graphite Operation in Mozambique following a nearly year-long suspension caused by community protests and resettlement disputes. Production recommenced in mid-June 2025, with the plant achieving a peak daily recovery rate exceeding 80% and producing 6,500 tonnes of graphite in the quarter. Product quality met customer specifications, and the company is operating in campaign mode to rebuild inventory ahead of anticipated high-volume shipments.
The resolution of longstanding grievances with resettled farmers, formalized through an agreement involving the Mozambique government, was pivotal in restoring site access and stabilizing operations. Syrah reported a total recordable injury frequency rate (TRIFR) of 1.3 at Balama, underscoring its commitment to safety during the restart phase.
Vidalia Facility Advances Amid US Market Dynamics
In the United States, Syrah’s Vidalia Active Anode Material (AAM) facility is progressing through technical qualification processes with key customers, including Tesla and Lucid. Although commercial sales have not yet commenced, the company anticipates starting revenue-generating shipments within 2025. The timing remains contingent on completing customer qualifications and securing additional offtake agreements, which are critical prerequisites for the planned expansion of Vidalia’s production capacity from 11.25ktpa to 45ktpa.
Syrah is actively negotiating with multiple US-based battery manufacturers and automotive OEMs, reflecting the growing demand for domestically sourced battery materials driven by evolving US trade policies and incentives. The company’s strategy aligns with the US government’s critical minerals agenda, which includes lucrative Section 45X Production Credits expected to provide approximately US$12 million in benefits in the December 2025 quarter.
US Tariffs on Chinese Imports Bolster Syrah’s Competitive Position
Significant regulatory developments in the US are reshaping the competitive landscape for battery materials. The US Department of Commerce has imposed preliminary antidumping duties of at least 93.5% and countervailing duties exceeding 11.5% on Chinese AAM imports, with some exporters facing rates above 700%. These measures, alongside existing tariffs and import restrictions, aim to curb subsidized and unfairly priced Chinese imports, thereby enhancing market opportunities for Syrah’s US-based production.
These trade actions are expected to accelerate demand for Vidalia’s AAM products and increase the need for Balama’s natural graphite as feedstock for non-integrated AAM producers outside China. Syrah’s supply chain is further insulated by sourcing inputs from Mozambique and other non-Chinese suppliers, mitigating the impact of reciprocal tariffs.
Financial Position and Capital Raising
Syrah closed the quarter with a cash balance of US$43 million, including restricted funds earmarked for operational and capital costs at Balama and Vidalia. The company secured an underwritten institutional placement and entitlement offer raising approximately A$70 million (US$46 million) to support Vidalia’s operating costs, loan reserves, and general corporate expenses.
Additionally, Syrah negotiated forbearance agreements with the US Department of Energy (DOE) deferring US$16 million in principal and interest payments on its DOE loan, and extended waivers with the US International Development Finance Corporation (DFC) concerning loan defaults linked to Balama’s operational interruptions. These arrangements provide critical financial flexibility as Syrah navigates its operational ramp-up and commercial milestones.
Leadership and ESG Commitments
On the governance front, Syrah announced that Chair Jim Askew will retire by the end of 2025, with a successor appointment underway. The company also appointed Robert Edel as a Non-executive Director, nominated by AustralianSuper. Syrah continues to emphasize environmental, social, and governance (ESG) initiatives, differentiating its products through responsible mining certifications and sustainability assessments, particularly in contrast to Chinese graphite producers.
Looking ahead, Syrah’s trajectory is closely tied to the evolving global electric vehicle market, which saw a 28% increase in sales in the June 2025 quarter, and the shifting geopolitical landscape influencing supply chains and trade policies. The company’s ability to capitalize on these trends while managing operational and financial challenges will be critical to its growth.
Bottom Line?
Syrah’s operational restart and strategic positioning amid US trade reforms set the stage for a pivotal year ahead, with financing and sales milestones in focus.
Questions in the middle?
- When will Vidalia secure binding offtake agreements to trigger its expansion final investment decision?
- How will ongoing US trade policy developments and tariff adjustments impact Syrah’s competitive dynamics?
- What is the outlook for Balama’s production ramp-up and community relations stability in Mozambique?