China strengthened export controls on some categories of graphite, a key material in electric vehicle batteries, on October 20 in a move aimed at safeguarding national security and the stability of China's supply chain in the face of the escalating crackdown and restrictions on China's high-tech sector from the West. China's General Administration of Customs (GAC) and the Ministry of Commerce (MOFCOM) jointly issued a notice imposing export controls on certain kinds of highly sensitive graphite items. China will require exporters to apply for permits, effective from December 1. China is the world's largest producer and exporter of graphite. The types of highly sensitive graphite items had already been under temporary controls, MOFCOM said, and are now being made official. Meanwhile, temporary controls over five types of low-sensitivity graphite items, which are primarily used in downstream industries such as steel, metallurgy, and the chemical industry, have been lifted.
The implementation of export controls on specific graphite items is a common international practice. China's move is a regular adjustment to better safeguard its national security and interests and does not target any specific country or region, MOFCOM said in a statement. The move comes after the Chinese government recently conducted a comprehensive assessment of temporary controls covering graphite items, in accordance with the Export Control Law, and made a decision to make the optimization, according to the statement.
As the West continues to intensify its containment efforts against China, critical materials for high-end manufacturing have become a major point of competition, and China has every right to take the necessary measures to protect its own security and interests, Tian Yun, a veteran economist based in Beijing, told the Global Times. “Graphite is a key material that holds strategic significance in the new-energy industry and global players are fiercely competing with one another in this sector,” Tian said. “It can be expected that similar moves will be more commonplace if the U.S. continues to escalate sanctions in the technological field against China.”
China has a high production capacity and strong processing capabilities of graphite materials, however, there is no reason for China to continue exhausting its own mineral resources, only to be blocked from pursuing technological development, experts said. They added that recent restrictions by the U.S. and its allies to cut off Chinese companies from the chip and EV industry are clearly hurting China's industrial chain. Sun Qing, Honorary President of the China Carbon Industry Association, told the Global Times that the move will benefit the development of the industry.
