The Renascor Resources Ltd (ASX: RNU) share price broke a new high today after announcing a memorandum of understanding (MOU) with a leading Japanese trading company.
Renascor shares reached as high as 18.5 cents at the market open before losing ground throughout the day. By the close of trading, the Renascor share price was up 6.67% at 16.2 cents.
What's pushing the Renascor share price higher?
In today's release, Renascor advised it had signed a non-binding MOU with Hanwa CoLtd (Hanwa) to supply purified spherical graphite (PSG).
Founded in 1947, Hanwa is one of the largest traders of battery chemicals in the Asian region. The Japanese company operates a dedicated battery team that supplies graphite across the global battery chain.
Hanwa also deals with the wholesale, import, and export of steel products, non-ferrous metals, industrial machines, and food products. Last year, the company reported more than $21 billion in sales, reflecting its size and scale of operations.
Details of the agreement
Under the framework, Renascor will provide up to 10,000 tonnes per annum of PSG over 10 years. This will be manufactured and delivered from the company's planned Battery Anode Material operation in South Australia.
Renascor highlighted that the potential purchase covered more than one-third of its projected initial PSG production capacity at the plant.
Additional product validation tests will be carried out before any formal binding agreement being signed. Once successful, both the final annual delivery amount and the contract duration will be finalised. This includes price, product quality, and other parameters.
Management commentary
Renascor managing director David Christensen commented:
Our MOU with Hanwa is a further significant step toward Renascor constructing, in Australia, the first integrated, in-country mine and Purified Spherical Graphite operation outside of China.
We are particularly pleased to be working with Hanwa, a leading Japanese-based global trading company, providing access to the Japanese anode market, which is the largest market for PSG outside of China.
Mr Christensen said the Hanwa MOU, together with MOUs with Minguang New Material and Zeto, potentially accounted for 100% of the company's planned Stage 1 PSG production.
As a result of an increase in inbound enquiries from globally recognised anode and battery companies for Siviour PSG, we are now considering an expanded Stage 1 production capacity and/or an additional Stage 2 PSG production capacity.
The Renascor share price has gained an astonishing 3,100% over the past 12 months and is up more than 1,200% year-to-date.
