The US Department of Commerce on Thursday imposed a preliminary anti-dumping duty of 93.5% on Chinese anode graphite suppliers. This followed investigations by the department, which concluded that the materials, a key component of electric vehicle batteries, are being sold in the United States below fair market value.
As reported by Reuters news agency, a Department of Commerce fact sheet indicates a uniform anti-dumping margin and cash deposit rate of 93.5% for all Chinese manufacturers. According to the Department of Commerce, imports of anode-grade graphite material from China amounted to $347.1 million in 2023.
A separate, parallel anti-subsidy investigation by the department had already resulted in a 6.55% duty for most manufacturers on May 20. However, the Department of Commerce imposed significantly higher duties on Chinese manufacturers Huzhou Kaijin New Energy Technology Corp and Shanghai Shaosheng Knitted Sweat. They were charged 712.03% and 721.03% duties, respectively.
US Final Ruling by December 5
The new duties apply to anode-grade graphite material with a minimum pure carbon content of 90 weight percent. This affects both synthetic and natural graphite, as well as a mixture of the two. For now, the duties are provisional, as the Department of Commerce plans to finalize the anti-dumping and anti-subsidy duties for graphite anode material by December 5, 2025.
The two review procedures were initiated by the American Active Anode Material Producers. This is an ad-hoc coalition of US manufacturers, including Anovion Technologies from Sanborn, New York, Syrah Technologies LLC from Vidalia, Louisiana, and Novonix Anode Materials from Chattanooga, Tennessee. All of them are suffering from the low prices with which Chinese suppliers are flooding the US market.
The pricing policy of Chinese suppliers not only threatens the economic existence of these and other companies in the industry, but also has a political component. If a fierce price war, similar to that seen with solar modules, gradually eliminates Western suppliers from the market, China will, in the long run, control not only the supply of graphite but also its processing into anode material and other applications.
The West is Reacting Slowly, but it is Reacting, and Determination is Growing
The Chinese oligopoly emerging in this way not only forces customers to purchase exclusively from the Middle Kingdom but also provides the country’s communist leadership with a political leverage that can easily be used against Western countries in conflicts. Such steps are all too well known from germanium, gallium, and antimony.
Currently, about two-thirds of the US demand for anode-grade graphite is met by imports from China. The US industry itself is in the unfortunate position of not having the necessary capacities to supply both its own quantity requirements and the demanded quality of graphite.
This weakness and the resulting dilemma have been evident for quite some time. However, it is now being seriously addressed in the US. Therefore, reducing strategic dependence on China initially and completely ending it over time has been the stated goal not just since Donald Trump took office.
A Dual Strategy Aims to Provide Relief: EcoGraf and Ucore Rare Metals Benefit
Therefore, a dual strategy is being pursued for all critical raw materials. Duties and other protective mechanisms are intended to ward off the dumping policies of Chinese suppliers and protect existing industries. At the same time, the domestic industry itself is to be encouraged to make new investments. This can only succeed in the long term if companies can achieve appropriate prices for their products. At this point, duties are an effective protective mechanism.
The second strategy aims at developing domestic deposits. It is therefore an indispensable complement to protecting the processing industry. In the case of rare earths, the US Department of Defense has already invested in MP Materials and signed a cooperation agreement with Ucore Rare Metals. For graphite, EcoGraf is one of the companies benefiting from Western countries waking up and seeking ways to reduce their massive dependence on China.
Here, it is the European Union that is currently examining whether the Epanko graphite project in Tanzania should be promoted and supported during its development phase. While a final decision has not yet been made, the underlying trend behind the process is unmistakable: faster approval processes and more active, and if necessary, financial involvement in projects are intended to bring them into production as quickly as possible.
Whether the US, Canada, or the European Union takes the lead in individual cases is relatively insignificant. What matters and what unites all Western countries is the endeavor to break China’s dominance and their own dependence on the People’s Republic in strategic raw materials as quickly as possible. A new, long-term trend is currently emerging here. Investors who wish to participate in and profit from this trend would do well to look at companies like EcoGraf and Ucore Rare Metals before the general public becomes aware of them and their stock prices soar.
