The Syrah Resources Ltd (ASX: SYR) share price has been the best performer on the ASX 200 on Monday.
In morning trade the graphite miner's shares are up a sizeable 5% to $1.52.
Why is the Syrah share price up 5% today?
Investors have responded positively to an announcement out of Syrah this morning in relation to the production of spherical graphite at its U.S. facility.
According to the release, the company has achieved the first production of unpurified spherical graphite at the Battery Anode Material (BAM) facility in Louisiana, United States using natural graphite which was produced from its Balama project in Mozambique.
The company's managing director and CEO, Shaun Verner, believes this is an important step for the graphite miner.
He said: "The first production of spherical graphite from our BAM facility in Louisiana is a significant milestone for the Company and a tribute to the dedication of the Syrah team and our contracting partners on site. We will soon dispatch first unpurified product to commence the customer qualification process."
Mr Verner appears optimistic that it will put the company in a strong position in the battery manufacturing supply chain outside Asia.
He added: "This achievement is an important step for Syrah to capture advantage in establishing a core ex-Asia supply chain position, as the battery manufacturing supply chain co-locates and expands outside Asia."
Should you invest?
While I agree that this is an important step for Syrah, I wouldn't rush in to invest on the back of it.
Instead, I would suggest investors wait for its December quarter update next month and see what prices the company has been commanding for its graphite.
If the latest Orocobre Limited (ASX: ORE) update is anything to go by, prices may have weakened greatly in the last quarter due to soft market conditions.
The same applies to industry peers Galaxy Resources Limited (ASX: GXY) and Pilbara Minerals Ltd (ASX: PLS).
