The five-year “statement of sales intent” was signed with Hiller Carbon, a supplier to North American steel producers, and covers 25,000-35,000 tonnes per annum.

The lower quality graphite to be produced at Balama and intended to be sold to the likes of Hiller is said to be suitable for steel producers using electric arc furnaces.

Syrah has previously signed an MoU with steel sector consumables company Asmet for 100,000t of graphite “fines”, and has a marketing agreement with trader Marubeni for an undisclosed tonnage of “fines and spherical” output.

It also signed a 10-year, 15,000tpa “statement of sales intent” with “one of the world’s “largest refractory producers”.

Late last year Macquarie analysts flagged annual output of 313,000t of graphite concentrate, of which it is understood 25,000t is suitable for the higher value lithium ion battery market (and possibly attracting a price of $US7000/t), and the balance for lesser value uses such as in electric arc furnace steelmaking.

“Syrah expects to be able to sell by-products of the spherical graphite process as recarburiser, a steel hardening additive,” Macquarie said at the time. “However, with the refractory market currently shifting into oversupply we believe that Balama product will need to displace existing products either through superior quality or lower price. Syrah’s other non-spherical products are also expected to be premium quality and suitable for suppling other existing technology applications and the traditional steel market.”

Shares in Syrah were up 1.2% to $A3.40 this afternoon, capitalising the company at just under $800 million.