Tesla is turning to Mozambique for a key component in its electric car batteries in what analysts believe is a first-of-its-kind deal designed to reduce its dependence on China for graphite.
Elon Musk’s company signed an agreement last month with Australia’s Syrah Resources, which operates one of the world’s largest graphite mines in the southern African country.
AutoBlog.com is calling the partnership between the electric car manufacturer and the producer of the mineral critical for lithium-ion batteries rather unique, while the value of the deal has not been released.
Tesla will buy the material from the company’s processing plant in Vidalia, Louisiana, which sources graphite from its mine in Balama, Mozambique.
The Austin, Texas-based EV maker plans to buy up 80 percent of what the plant produces – or about 8,000 tons of graphite per year – starting in 2025, according to the agreement. Syrah must prove the material meets Tesla’s standards, reports the South China Morning Post.
In December 2021, Reuters reported that Chinese battery and EV makers are also scouring the globe looking for graphite. Presently, about 70 percent of all graphite comes from China, and there are few viable alternatives for batteries.
Graphite, in both synthetic and its natural forms, is used for the negative end of a lithium-ion battery, known as the anode. The global demand for graphite has surged along with rapid growth in the battery market in recent years.
The UK’s Benchmark Mineral Intelligence (BMI) sees a roughly 20,000-tonne graphite deficit in 2022, versus a similar-sized surplus last year. About 20,000 tonnes of graphite is enough to make batteries for roughly 250,000 EVs, an industrial source said.

China-based Contemporary Amperex Technology Co Ltd, a top global EV battery maker, is “desperate” to secure a supply of key ingredients such as graphite to keep up with rising orders, said a person with knowledge of the matter.
Simon Moores, with BMI, says, “It starts at the top with geopolitics. The US wants to build enough capacity domestically to be able to build (lithium-ion batteries) within the USA.”
Moores also said producing the batteries in the US will reduce some of the questions Tesla faces about its ties to China, where there are environmental concerns at some mines.
