The Syrah Resources Ltd (ASX: SYR) share price is having a strong start to the day.
In morning trade, the graphite producer's shares are up 5% to 49.5 cents.
Image source: Getty Images
Why is the Syrah share price jumping?
Investors have been buying Syrah's shares today after the company released an encouraging quarterly update.
According to the release, Syrah reported higher quarter on quarter natural graphite sales and improved demand from Chinese anode customers. A total of 23kt natural graphite was sold and shipped to third-party customers and 4kt was shipped to its Vidalia operation in the United States.
A single production campaign took place during the quarter and produced 18kt at a 73% recovery. Pleasingly, things improved towards the end of the quarter, with its recovery lifting to 82% for the final two weeks.
Balama C1 costs came in at US$484 per tonne during the operating period in September and C1 fixed costs were US$4 million per month during the shutdown period.
Syrah reported a weighted average sales price of US$528 per tonne, which was lower quarter on quarter due to significantly higher fine flake sales and lower prices during China's domestic production season.
At the end of the quarter, Syrah had US$81 million in cash, including US$31 million of restricted cash. However, it has a number of potential funding options on the horizon that could boost its balance sheet.
Outlook
The company intends to continue to operate Balama in campaign operating mode in the December quarter.
This will see further ~30-day high-capacity utilisation production campaigns followed by curtailment periods determined by inventory levels and new sales demand. As things stand, one ~20kt production campaign is expected during the quarter.
The Syrah Resources share price remains down ~70% over the last 12 months.
