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China Tightens Exports on Graphite, a Key Component of EV Batteries

China Tightens Exports on Graphite, a Key Component of EV Batteries

China’s move may make EVs an even more important issue in the upcoming presidential campaign.

It turns out graphite isn’t only used in pencils. The compound, a crystalline form of the element carbon, is most commonly used to serve as the anode material batteries for electric vehicles (EVs) due to its relatively low-cost and energy density.

China, the top graphite producer, has just announced that it will begin tightening the supply and require export permits for some graphite products to protect national security.

It also refines more than 90% of the world’s graphite into the material that is used in virtually all EV battery anodes, which is the negatively charged portion of a battery.

“This bold and unexpected move by China in graphite has taken us by surprise, arriving far sooner than anyone could have predicted,” said Kien Huynh, chief commercial officer at Alkemy Capital Investments , which is focused on developing projects in the energy transition metals sector.

Beijing requires the export permits at a time when many foreign governments are ratcheting up pressure on Chinese companies over their industrial practices.

This development presents a significant challenge to US EV battery manufacturing and could be a substantial setback for a burgeoning industry.

In the U.S., there are four lithium-ion battery plants in operation, with another 21 in development. At full capacity, these plants are expected to require about 1.2 million tons of spherical graphite—a refined form used as anodes in lithium-ion batteries—every year, according to the United States Geological Survey.

Graphite can be produced either from naturally mined material or in a synthetic process using petroleum feedstocks. China is by far the leader in both areas.

Last year, China mined 850,000 tons of natural graphite, about 65% of the world’s total production. The country also processed most of the battery-grade spherical graphite.

The U.S., on the other hand, doesn’t mine or produce any natural graphite. From 2018 to 2021, about 33% of U.S. imports came from China, followed by 18% and 17% from Mexico and Canada, respectively.

With the supplies of a key component of the essential batteries decreasing, prices can be expected to rise….making it more challenging to market (especially to increasingly cash-strapped consumers). Perhaps American car makers are looking farther down the road at EV realities.

With Ford’s all-electric F-150 Lightning out on the open road for over a year, you would think that General Motors is eager to create some electric pickup segment competition. But the Ford’s competitor, the Chevrolet Silverado EV, is not ready for prime time and GM is actually pushing its launch back by a whole year.

Why is GM taking what seems like a drastic action? Diminished demand for new EVs, the automaker says, among other engineering challenges. GM says that demand is so down, in fact, that it is diverting 1000 employees from its Orion Assembly plant in Lake Orion, Michigan (which is currently being retooled for EV production), to other Michigan assembly facilities.

It’s in GM’s best interest to retool its Orion plant for electric truck manufacturing, as the facility will phase out Chevrolet Bolt production later this year, though it’s surprising to see a manufacturer delay what is likely to be its flagship EV. But GM isn’t alone in its assessment of the EV market, as Ford temporarily slows down F-150 Lightning production.

Neither automakers conceded that these production problems were a result of the current United Auto Workers strike, either. And it’s not just Ford and GM that are struggling with an alleged EV market lull, as companies like Lucid Motors produced 30% fewer models this quarter. Similarly, F-150 Lightning sales were down 46% in the last three months.

China’s move may make EVs an even more important issue in the upcoming presidential campaign.

They [EVs] have become a political football,’ said Ford Motor Chief Executive Officer Jim Farley, as he lamented the increasingly political environment surrounding the subject of electric vehicles.

In a recent statewide survey of Michigan voters, Trump led Biden 46 percent to 43 percent among the state’s United Auto Workers union members.

The drop in Biden’s numbers among union workers is likely due to the president’s vocal support of EVs.


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I’m not sure how these retards thought that leaving the supply chains for such things in the hands of our biggest adversary would be a good idea

    TargaGTS in reply to Ironclaw. | October 24, 2023 at 3:58 pm

    Wait until you find out where at least 70% of our critical care meds come from. Approaching 4-years since the start of COVID and the US hasn’t done anything to reshore the production of critical medications and supplies. It’s been a bipartisan failure of the highest order.

      The Gentle Grizzly in reply to TargaGTS. | October 24, 2023 at 6:03 pm

      Or, a bipartisan money-maker for 537 or so certain people.

      paracelsus in reply to TargaGTS. | October 24, 2023 at 6:24 pm

      if I may be presumptuous (somewhat), “…and the US hasn’t done anything…”. I would recommend a change to ‘and the Biden administration hasn’t done anything.’

    henrybowman in reply to Ironclaw. | October 24, 2023 at 5:15 pm

    To be brutally honest, I know far too many conservative “retard” acticists who think that depending on their biggest adversaries for IT, banking, and web-based promotional services is a good idea.

    The most retarded are the ones who incredibly expected their biggest adversaries to provide infrastructure to the services they were developing to compete head to head with them.

    The irony is oh-so-rich here. Anyone who has learned even the most fundamental basics about supply chain economics is familiar with ‘I, Pencil’ yet it seems our esteemed ‘leaders’ never learned a damn thing.

    The people who made us so dependent upon our primary geopolitical foe should all be hung by the neck until dead. They’re traitors, plain and simple.

    JohnSmith100 in reply to Ironclaw. | October 24, 2023 at 5:24 pm

    The answer is to restore full petro production and make our own graphic. Also, rebuild our manufacturing base. We should not be dependent on any Commie country for crucial items.

    It is foolish to have huge capital outflow for petro.

      henrybowman in reply to JohnSmith100. | October 24, 2023 at 7:10 pm

      Not just petro production, but stop the panicked establishment of “National Heritage Areas” every time and everywhere somebody finds valuable strategic and economic mineral deposits that could otherwise actually be mined.

      Ironclaw in reply to JohnSmith100. | October 24, 2023 at 7:22 pm

      Well, with the recent Exxon and Chevron deals buying large petroleum fracking outfits, I kind of wonder if maybe they’re going to do something in spite of that pedophile in the white house.

      JohnSmith100 in reply to JohnSmith100. | October 24, 2023 at 11:33 pm

      There are several alternatives for the anode, I think it likely that we will adopt the, producing superior battery’s.

2smartforlibs | October 24, 2023 at 3:36 pm

So what are you going to do when the BUYden green says you now have no way to get around because gas is illegal and you can’t get batteries?

ThePrimordialOrderedPair | October 24, 2023 at 3:52 pm

I remember Bill Clinton and how he shilled so hard for China to get Most Favored Nation trading status …

China has every right to do this. It’s their material. Shame on us. Let’s kick out EVERY Chinese student in this country along with those 40,000 single aged men “sleeper agents” who hopped the non-existent border fence. We need TRUMP more than ever. Buyden is China-compromised.

    JohnSmith100 in reply to walls. | October 24, 2023 at 5:32 pm

    And all Pale’s, those who do not fully assimilate should be broomed. Future naturalizations should be revocable for both the 1st and 2nd generation, subject to good behavior. And end birthright citizenship.

Wait a minute. I thought carbon was bad and we were supposed to bury it.

    henrybowman in reply to txvet2. | October 24, 2023 at 5:19 pm

    We’re burying it in green batteries, try to keep up.
    Even if it were a poison, we’d only be poisoning our landfills and all our groundwater.
    But then, activated carbon is used in water purification filters.
    Oh, it’s so hard to keep all the lies sCIeNcE straight!

US Green Energy Policy:

1. Mandate EV’s first
2. Worry about supply chain later
3. Back to drawing board

Graphite is an important component of solid state devices such as classical crystal sets.

IMO, we will see more of the same from nearly every Nation which possesses scarce resources. Probably won’t be an official cartel of commodity rich Nations like OPEC but bet your bottom dollar there will be discussions among them about how to maximize value and reduce dependency on the West.