China has restricted the export of the raw material graphite. The mineral is used, among other things, in the production of lithium-ion batteries, which are used in e-cars, e-bikes and electrical devices. The People’s Republic is requiring special export permits for three “highly sensitive” varieties of the mineral, the Ministry of Commerce and Customs announced in Beijing on Friday.
That sounds like a spell a report
According to the “Financial Times”, the decision by the Chinese authorities is creating great uncertainty among the industries that depend on the raw material. The authorities justified the measure with “national security” and pointed out that export controls on graphite were “standard international practice”. According to the announcement, China dropped export controls for five less sensitive graphite types that are used, for example, in the steel industry.
Response to US sanctions
Observers on the Chinese and Western sides suspect Beijing’s move is a countermeasure to US sanctions in the technology sector. The world’s largest and second-largest economies have been slowing each other down with mutual sanctions for a long time and usually justify these with national security.
The US government under Joe Biden (80) recently tightened the export of microchips for the sector artificial intelligence – a strategically important sector in which China wants to catch up. Beijing previously imposed restrictions in July the export of gallium and germanium one or two raw materials that are also important for electric cars and microchips.
China has numerous important raw materials and is a major producer of graphite worldwide. According to the annual report from the US Geological Survey, the country was responsible for 65 percent of graphite deliveries in 2022.
The German Raw Materials Agency warned in a risk assessment in 2021 of “potential supply and delivery risks for European cell manufacturers” due to the high market concentration in China – also with reference to government approval requirements under which the export of graphite is subject.