Import Ban on Black Mass from Recycled Lithium Batteries Lifted! Will the Slumping Battery Recycling Market Be Revitalized?

Recently, to promote the recycling of renewable resources and standardize the import management of regenerated black mass raw materials for lithium-ion batteries and regenerated steel raw materials, the Ministry of Ecology and Environment, the General Administration of Customs, the National Development and Reform Commission (NDRC), the Ministry of Industry and Information Technology, the Ministry of Commerce, and the State Administration for Market Regulation jointly issued the "Announcement on Matters Related to Standardizing the Import Management of Regenerated Black Mass Raw Materials for Lithium-ion Batteries and Regenerated Steel Raw Materials," which will be implemented from August 1, 2025.

The announcement states that regenerated black mass raw materials for lithium-ion batteries that meet the requirements of Attached Table 1 are not classified as solid waste and can be freely imported. Regenerated black mass raw materials must not be mixed with other types of regenerated raw materials, and different types of regenerated raw materials cannot be declared under the same customs declaration form. Imported regenerated black mass raw materials cannot be in bulk, and different categories of regenerated black mass raw materials should be placed separately.

The customs commodity code for regenerated black mass raw materials for lithium-ion batteries is 3824999996. This customs commodity code is for customs clearance declaration purposes only.

In addition, the inspection of regenerated black mass raw materials for lithium-ion batteries shall be conducted in accordance with the technical specifications of the customs industry to determine whether they meet the index requirements of Attached Table 1.

Except for radioactive contamination inspections, which shall comply with the specialized inspection requirements of the customs, the inspection of regenerated steel raw materials shall first employ sensory inspection. When it cannot be determined whether they meet the index requirements of Attached Table 2, the inspection shall be conducted in accordance with the technical specifications of the customs industry.

The announcement also clarifies that imported regenerated black mass raw materials for lithium-ion batteries and regenerated steel raw materials shall comply with the requirements of this announcement. If the customs finds that imported regenerated black mass raw materials for lithium-ion batteries or regenerated steel raw materials are suspected of being solid waste, it may entrust a professional institution to conduct attribute identification and manage them in accordance with the law based on the identification conclusions.

Data shows that in December 2014, the Ministry of Environmental Protection, the Ministry of Commerce, the NDRC, the General Administration of Customs, and the General Administration of Quality Supervision, Inspection and Quarantine jointly issued the announcement on the "Catalogue of Waste Materials for Import" (2015), which included battery scrap in the catalogue of solid waste prohibited from import. Since then, battery scrap in China has been in a state of prohibited import.

On December 31, 2024, the State Administration for Market Regulation and the Standardization Administration of China issued GB/T 45203-2024 "Regenerated Black Mass for Lithium-ion Batteries." This standard is the first national standard for strategic black mass in China and even globally, and it will be implemented from July 1, 2025.

Black mass is a key product in the recycling process of lithium-ion batteries. Black mass is the black or gray-black powder containing one or more valuable components such as nickel, cobalt, and lithium, produced after the resourceful processing of lithium-ion battery scrap through discharge, disassembly, crushing, heat treatment, etc. The abundance of strategic resources such as nickel, cobalt, and lithium in black mass is significantly higher than that in raw ore, making it a valuable "resource-rich mine." With the rapid development of the global new energy industry and the substantial export of lithium batteries, one of the "new three" export products, the total volume of lithium battery scrap has gradually increased. The demand for black mass in China has continued to grow. However, there has been a lack of national or industry standards for black mass products in the circulation and detection processes. On one hand, the varying technological capabilities of different enterprises have led to inconsistent product compositions, making it impossible to unify quality requirements for circulation. On the other hand, in the absence of standards and regulations, black mass struggles to shed its label as waste and cannot be reimported into the country as a product. As a result, this valuable "resource-rich mine" cannot be repatriated.

The release of this standard has standardized indicator items and parameters such as the chemical composition of products, providing national-level standards and bases for the industry, ensuring that product quality meets green and environmental protection requirements, facilitating compliant trade and import of products, and promoting the green, low-carbon, and sustainable development of the new energy industry.

The release of the new national standard, combined with the release of this announcement, has not lifted the ban on the import of spent batteries but has allowed the import of recycled black mass from lithium batteries. This will enhance the enthusiasm of Chinese enterprises to build battery recycling plants and black mass factories overseas, open up overseas black mass supply channels, achieve the repatriation of the "resource-rich mine," and bring new development opportunities to the recycling business.

For example, GEM (002340) has signed investment agreements with South Korean battery material producer EcoPro, Indonesia's Vale, and Indonesia's Merdeka to build an industrial park integrating nickel smelting, battery materials, power batteries, battery recycling, and battery integration, with an annual production capacity of approximately 30 GWh of power batteries.

In addition, on May 27, Li Lecheng, Secretary of the Party Leadership Group and Minister of the Ministry of Industry and Information Technology (MIIT), chaired the first meeting of the National Task Force on the Recycling of Power Batteries from New Energy Vehicles, deploying key tasks for the construction of a recycling system for power batteries from new energy vehicles.

The meeting emphasized the need to improve the regulatory framework, accelerate the formulation of relevant laws and regulations, and develop and revise mandatory standards such as safety technical specifications for various types of lithium batteries, using legal means to regulate recycling practices and leading the industry's high-quality development with standards. It is necessary to strengthen supervision and management throughout the entire chain, closely monitor battery production, vehicle scrapping, dismantling and utilization, and other links, eliminate bottlenecks in the supervision of the entire process, use digital technologies to strengthen the monitoring of the flow of power batteries, and investigate and punish illegal dismantling that pollutes the environment and unlicensed operations in accordance with the law. It is also necessary to enhance the industry's capabilities, increase collaborative research, development, and application of key technologies, processes, and equipment, further strengthen standardized industry management, implement dynamic management of enterprises that meet regulatory conditions with a "flexible entry and exit" approach, support key enterprises in becoming better and stronger, and guide the healthy development of the industry.

Battery Network noted that in May this year, data released by Qichacha showed that the number of registered battery recycling-related enterprises in China had basically increased year by year over the past decade, especially in 2021, when the annual registration volume surged by 286.2% YoY to 27,700, reaching the peak growth rate in the past decade. In 2023, a cumulative total of 46,500 battery recycling-related enterprises were registered in China, marking the peak in the number of registered enterprises in the past decade.

As of the end of April this year, 14,600 battery recycling-related enterprises had been registered in China in 2025, representing a 13.9% increase compared to the same period in 2024.

In terms of the existing enterprises, there are currently 177,000 battery recycling-related enterprises in China, with over 60% of them established within the past three years.

Furthermore, according to data from the "White Paper on the Development of China's Lithium-ion Battery Recycling, Dismantling, and Second-life Application Industry (2025)" jointly released by research institutions EVTank, Eve Economics Research Institute, and the China Battery Industry Research Institute, the actual recycling volume of spent lithium-ion batteries in China in 2024 was 654,000 mt, representing a mere 5.0% YoY increase. Among this, the recycling volume of LFP batteries and scrap reached 400,000 mt, accounting for 61.2% of the total, while the recycling volume of ternary lithium batteries and scrap was 243,000 mt. The actual recycling volume of other batteries was only 10,000 mt. Affected by raw material prices, the market size for the recycling of spent lithium-ion batteries declined by 31.0% YoY to 8.66 billion yuan. Looking ahead, EVTank expects that by 2030, the recycling volume of lithium-ion batteries in China will reach 4.246 million mt.

EVTank pointed out that since 2024, influenced by the decline in upstream material prices, the economic viability of the battery recycling industry has weakened, and the enthusiasm of recycling enterprises has decreased. Except for top-tier enterprises that have seen an increase in operating revenue, most enterprises have experienced a decline in both revenue and gross profit. On the other hand, policies such as the revision of the "Comprehensive Utilisation Industry Specification Conditions for Spent Power Batteries of New Energy Vehicles (2024 Edition)" by the Ministry of Industry and Information Technology (MIIT) and the "Action Plan for Improving the Recycling and Utilisation System of Power Batteries for New Energy Vehicles" issued by the State Council will further raise the threshold for the battery recycling white list. The phenomenon of "bad money driving out good" in the battery recycling industry, as well as "workshop-style" factories, will gradually disappear and exit, and the entire battery recycling industry will enter a new stage of standardised development.

From the perspective of capacity construction, EVTank data shows that as of the end of 2024, the second-life application and recycling dismantling capacity of lithium-ion batteries on China's white list was 4.233 million mt/year, including 2.042 million mt/year for second-life application capacity and 2.191 million mt/year for recycling dismantling capacity. The growth rate of the industry's capacity has significantly slowed down compared to before 2023, indicating that the industry has entered a stage of rational development. According to the planning objectives of various enterprises, China's lithium-ion battery recycling capacity is expected to reach 11.092 million mt/year by 2030.