[SMM Analysis] Focus on Graphite Anode Export Controls: Decoding Industry Reshaping and Global Changes Driven by New Policies

SMM Analysis:

On October 9, 2025, the Ministry of Commerce and the General Administration of Customs announced Decision No. 58 of 2025, which implemented export controls on items related to lithium batteries and artificial graphite anode materials. These control measures will officially take effect on November 8, 2025.

I. Comprehensive and Specific Control Content Customs Release Control Logic:

This round of controls on graphite anode-related items focuses on the "material - equipment - technology" entire industry chain, with clear scope and standards, providing precise basis for practical implementation:

• Control of the Material Itself: Explicitly includes artificial graphite anode material and artificial/natural graphite blended anode material in the control list. According to the announcement, exports of these two material types must strictly comply with laws such as the "Export Control Law of the People's Republic of China," requiring prior application for an export license from the competent department of commerce under the State Council; export without permission is prohibited, controlling the cross-border flow of core anode materials at the source.
• Control of Production Equipment: Covers various key equipment used for producing graphite anode materials, including vertical granulators and continuous granulators with a granulation volume ≥5 m³, box furnaces, Acheson furnaces, internal series furnaces, continuous graphitisation furnaces and other graphitisation equipment, as well as fusion coating equipment with a volume >300 L, spray drying equipment with a volume >60 m³, and chemical vapor deposition (CVD) rotary kilns with a barrel diameter >0.5 m used for coating modification.
• Control of Production Processes and Technologies: Brings three core technologies in graphite anode production under control – granulation process (determines particle morphology and density), continuous graphitisation technology (key for improving production efficiency and product purity), and liquid-phase coating technology (core method for optimizing material interface properties) – restricting the outflow of the industry's core competitiveness from its technological roots and safeguarding the technological security baseline of the industry chain.

II. Based on Dual-Use Attributes, Anchored in National Security and International Obligations

• From the application perspective, artificial graphite anode material is a core component of high-energy-density lithium-ion batteries. In the civilian sector, it supports the development of industries such as NEVs and ESS power stations; in the military sector, it directly impacts the driving range and operational effectiveness of equipment like drones, individual soldier combat systems, and underwater submersibles, relating to national defense security.
• From the legal basis perspective, according to the "Export Control Law of the People's Republic of China" and the "Regulations on the Export Control of Dual-Use Items of the People's Republic of China," implementing export controls on items with dual-use attributes that may endanger national security is a conventional and necessary means to safeguard national interests and prevent technology misuse and proliferation risks in accordance with the law, aligning with internationally accepted export control rules.

III. Industry Impact: Short-Term Adjustments Coexist with Long-Term Reshaping, Global Industry Chain Structure Undergoes Changes

• Impact on Domestic Enterprises: Export-oriented enterprises face challenges in orders and market share. In the short term, they may experience delays in export orders and loss of some overseas market share due to factors such as permit approval processes and customer supply chain adjustments. However, in the long run, the policy will compel enterprises to increase R&D investment, seek technological breakthroughs in non-controlled areas such as solid-state batteries and natural graphite anodes, optimize product structure, and enhance their core competitiveness. Meanwhile, domestic enterprises may also strengthen cooperation with domestic battery manufacturers to expand their domestic market share.
• Impact on the Global Industry Chain: China is a core supplier of artificial graphite anode materials globally. This control measure will directly trigger adjustments in the global supply chain structure for anode materials. In the short term, the international market may face tight supply of artificial graphite anode materials, coupled with limited capacity expansion due to equipment and technology controls. It is expected that global anode material prices will experience phased increases, thereby driving up production costs for power batteries. In the long term, to address supply chain risks, overseas regions may accelerate the layout of the global lithium battery industry chain, and technological competition is expected to further intensify.

Ministry of Commerce and General Administration of Customs Jointly Announce Document Announcement No. 58 of 2025 Full Text of the Announcement:

Ministry of Commerce General Administration of Customs Announcement No. 58 of 2025 Announcement on the Decision to Implement Export Controls on Items Related to Lithium Batteries and Artificial Graphite Anode Materials

In accordance with the relevant provisions of the Export Control Law of the People's Republic of China, the Foreign Trade Law of the People's Republic of China, the Customs Law of the People's Republic of China, and the Regulations of the People's Republic of China on the Export Control of Dual-Use Items, and in order to safeguard national security and interests and fulfill international non-proliferation obligations, approved by the State Council, it is decided to implement export controls on the following items:

I. Items Related to Lithium Batteries

(1) 3A001 Rechargeable lithium-ion batteries (including cells and battery packs) with a gravimetric energy density greater than or equal to 300 Wh/kg (Reference Tariff Line Number: 85076000).

(2) 3B901.a. Equipment used for manufacturing rechargeable lithium-ion batteries:

1. Winding machines (Reference Tariff Line Number: 84798999);

2. Stacking machines (Reference Tariff Line Number: 84798999);

3. Electrolyte filling machines (Reference Tariff Line Number: 84798999);

4. Hot presses;

5. Formation and capacity grading systems;

6. Capacity grading cabinets.

(3) 3E901.a. Technologies for the production of items controlled under entry 3A001.

II. Items Related to Cathode Materials

(a) 3C901.a.1. LFP cathode material with a compaction density greater than or equal to 2.5 g/cm³ and a capacity per gram greater than or equal to 156 mAh/g (refer to tariff heading: 28429040).

(b) 3C901.a.2. Items related to precursors for ternary cathode materials:

a. Nickel-cobalt-manganese hydroxide (refer to tariff heading: 28539030);

b. Nickel-cobalt-aluminum hydroxide (refer to tariff heading: 28539050).

(c) 3C901.a.3. Lithium-rich manganese-based cathode materials.

(d) 3B901.b. Equipment used for manufacturing rechargeable lithium-ion battery cathode materials:

1. Roller hearth kiln;

2. High-speed mixer;

3. Sand mill;

4. Air jet mill.

III. Items Related to Graphite Anode Materials

(a) 3C901.b.1. Artificial graphite anode material.

(b) 3C902.b.2. Anode material composed of a mixture of artificial graphite and natural graphite.

(c) 3B901.c.1. Granulation process equipment used for producing graphite anode materials:

a. Vertical granulation reactor with a granulation volume greater than or equal to 5 m³;

b. Continuous granulation reactor with a granulation volume greater than or equal to 5 m³.

(d) 3B901.c.2. Graphitisation equipment used for producing graphite anode materials:

a. Box furnace;

b. Acheson furnace;

c. Internal series furnace;

d. Continuous graphitisation furnace.

(e) 3B901.c.3. Coating modification equipment used for producing graphite anode materials:

a. Fusion coating equipment with a volume greater than 300 L;

b. Spray drying equipment with a volume greater than 60 m³;

c. Chemical vapor deposition (CVD) rotary kiln with a barrel diameter greater than 0.5 m.

(f) 3E901.b. Processes and technologies used for producing graphite anode materials:

1. Granulation process;

2. Continuous graphitisation technology;

3. Liquid-phase coating technology.

Export operators exporting the above items shall apply for a license from the competent department of commerce under the State Council in accordance with the relevant provisions of the Export Control Law of the People's Republic of China and the Regulations of the People's Republic of China on the Export Control of Dual-Use Items.

Export operators shall be responsible for the authenticity of declared goods, strengthen the identification of export items, and, for items subject to control, must indicate "Subject to Dual-Use Items" in the remarks column of the customs declaration form and list the export control codes for dual-use items; for items not subject to control but with parameters, indicators, or performance close to controlled items, they must indicate "Not Subject to Controlled Items" in the remarks column and provide specific parameters and indicators. Where there are doubts regarding the completeness, accuracy, or authenticity of the information provided above, customs will raise inquiries in accordance with the law, and during the inquiry period, export goods will not be released.

This announcement takes effect on November 8, 2025. The "Export Control List of Dual-Use Items of the People's Republic of China" is updated simultaneously.

Ministry of Commerce General Administration of Customs

Oct 9, 2025