Cash in on Emerging Technologies by Investing in Graphite

Friends holding their smartphones

Friends holding their smartphonesYou would probably not think of graphite as an excellent investment opportunity for anyone looking to cash in on emerging technology. The mineral is in high demand in the lithium-ion batteries sector, as it powers electrical devices.

Drawing pencils are likely the first things that come to mind when graphite is mentioned. It probably takes you to the early years when you were learning how to read and write. If you haven’t held a pencil in years, you’d be thinking that your foray with graphite is over.

That would not be accurate; you’re probably using a product with graphite right now. See, graphite is a core component of the lithium-ion battery — the one that powers your phone. The growing popularity of smartphones has one benefit that could pad your wallet — it leads to spiking graphite costs.

A multibillion-dollar industry

Graphite makes the anode material in the lithium-ion batteries that power just about any known smart gadget. That makes it a $20-billion industry with future projections forecasting a 20 percent growth a year for the foreseeable future. Other than powering smartphones, lithium-ion batteries power electric cars.

As the government pushes towards eco-friendly cars, the production of these vehicles is soaring. The number of electric vehicles is projected to reach 17.5 million by the year 2020. That means there will be a consistently high demand for graphite in the coming years.

What does this mean for you?

It is only natural to imagine that you’re not averse to making some extra cash. If that’s the case, then you might want to consider investing in some graphite stocks. Doing so means you can profit from anticipated price hikes as demand continues to soar against a dwindling supply. China holds 75 percent of the world’s supply and is currently looking to build a stockpile that equals 80 percent of its annual output.

The spiking demand and dwindling supply have led to 40 percent increment in graphite prices over a span of six months. In both Europe and the U.S., graphite is declared a supply critical mineral. It means the prices are likely to shoot up in the near future.

Graphite has many industrial applications and the booming lithium-ion battery only adds to the list. The growing demand is causing the prices to rise, making it a perfect investment opportunity.