The Blackearth Minerals (ASX: BEM) share price is off to the races, up 150% in afternoon trading. We look at why.
The post The Blackearth Minerals (ASX:BEM) share price is rocketing 150% today. Here’s why appeared first on The Motley Fool Australia. –
The Blackearth Minerals NL (ASX: BEM) share price is off to the races, up 150% at 23 cents in afternoon trading.
Shares are soaring after BlackEarth announced a significant marketing agreement with a world-leading graphite supply group.
What agreement did BlackEarth Minerals make?
In an ASX release this morning, BlackEarth Minerals revealed it had signed an agreement with German-based Luxcarbon GmbH for the procurement, supply and marketing of graphite concentrate and downstream graphite products.
Luxcarbon is among Germany’s top suppliers of graphite and carbon products, counting Volkswagen, Mercedes, Ford and major chemical corporations among its clients.
Following its memorandum of understanding (MOU) with Urbix Inc, BlackEarth will use this agreement to secure the supply of up to 25,000 tonnes of high-grade product to help Urbix complete its plant development.
The company reported this would remain in place as it fast-tracks its work on its own graphite assets in Madagascar. It plans to use these provide a regular supply for its future downstream graphite operations.
Part of the agreement enables BlackEarth to sell up to 25,000 mtpa of downstream products to the European market. The company points to a growing demand for its products from the growth of the electric vehicle battery market.
Commenting on the agreement, BlackEarth managing director Tom Revy said:
This agreement provides a number of great outcomes for BlackEarth. Firstly, it enables us to secure a supply of world class graphite concentrate that can be supplied to Urbix’s operations in the USA and also our own downstream processing facility whilst we complete the development of our plants in Australia and Madagascar.
Secondly, Luxcarbon are leaders in the supply and understanding of downstream graphite products and this will assist us greatly.
The terms of the agreement run for 3 years. Luxcarbon and BlackEarth have the ability to extend the duration if they both consent.
BlackEarth share price snapshot
BlackEarth shares began trading on the ASX in January 2018. From there it was a choppy ride mostly downhill for shareholders until things took a big turnaround in December. On 22 December, the stock was trading for 2 cents per share. The current share price represents a 488% gain since then.
Year-to-date the BlackEarth share price is up 370%. By comparison, the All Ordinaries Index (ASX: XAO) is up 2.6% so far in 2021.
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Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.