Surging electric vehicle sales are straining the global supply of graphite, the single largest material by weight in lithium-ion battery anodes, and a mineral that remains overwhelmingly refined in China. The collision of fast-rising demand with concentrated, hard-to-diversify supply has triggered U.S. trade investigations, new government criticality designations, and growing concern that affordable EV production could stall if alternative sourcing does not scale quickly.
Why Batteries Cannot Work Without Graphite
Every lithium-ion cell in a modern EV relies on a graphite anode to store and release lithium ions during charge and discharge cycles. The material is not interchangeable with cheaper alternatives. Battery-grade graphite must be over 99.95% pure crystallized carbon and must meet strict particle size, shape, and exterior coating specifications before it can function in a cell. That exacting purity threshold means raw graphite, whether mined or synthesized, passes through energy-intensive refining steps that few facilities outside East Asia can perform at commercial scale, leaving battery makers with limited options when demand spikes.
Chemistry trends in the EV market are intensifying pressure on graphite specifically. The IEA’s Global EV Outlook 2025 documents rapid growth in battery demand through 2024 across regions and vehicle types, along with shifts toward lithium-iron-phosphate (LFP) chemistries. LFP cells eliminate cobalt and nickel but still require a full graphite anode, so the move away from nickel-rich cathodes does nothing to ease graphite consumption. The net effect is that global anode-material needs are climbing even faster than overall battery capacity, tightening the market for a material that is already difficult to substitute in high-performance applications.
China’s Refining Grip Tightens Through 2035
The supply bottleneck is not primarily about ore in the ground. Graphite deposits exist on several continents, and the USGS tracks production from natural sources in regions ranging from Africa to the Americas. The chokepoint sits at the refining and processing stage, where Chinese facilities dominate. The IEA’s Global Critical Minerals Outlook 2025 projects that China will still supply approximately 80% of graphite refining in 2035, a concentration ratio that barely budges from current levels despite announced investments elsewhere. That projection suggests the supply chain’s single-country dependency is structural, not cyclical, and will persist well into the next decade absent a dramatic policy or investment shift.
The U.S. Department of Energy reached a similar conclusion through a different lens. Its 2023 materials assessment identified graphite as carrying both high supply risk and high importance to clean-energy technologies through 2035, driven by rising demand with limited substitution options. That designation places graphite alongside a small group of minerals eligible for targeted federal support, including programs coordinated through ARPA‑E initiatives that aim to develop alternative chemistries and more efficient processing. Yet even aggressive research funding cannot change the near-term reality that most battery-grade graphite still passes through Chinese refineries before reaching global cell factories.
U.S. Trade Actions Target Chinese Anode Imports
Washington has moved beyond risk assessments to direct trade enforcement. The U.S. International Trade Commission voted in January 2025 to continue antidumping and countervailing duty investigations on active anode material from China, finding a reasonable indication of material retardation caused by allegedly dumped and subsidized imports. The investigations, numbered 701‑TA‑752 and 731‑TA‑1730, cover active anode material used in batteries, including natural graphite, synthetic graphite, and blends of the two. By treating these inputs as a distinct product category rather than generic industrial carbon, the ITC signaled that anode materials sit at the heart of its concerns about future U.S. battery manufacturing capacity.
The Commerce Department’s preliminary determination put teeth behind the inquiry. Its International Trade Administration set preliminary dumping margins of 93.50% for listed Chinese exporter and producer combinations, a rate high enough to effectively price those imports out of the U.S. market if finalized. The product scope explicitly covers the graphite-based anode materials that go into EV battery cells, meaning any duties would land directly on the cost structure of domestic battery pack assembly. Finalized duty rates have not yet been published through Commerce’s case records, so the 93.50% figure remains preliminary, but the signal to both U.S. and foreign suppliers is that low-priced Chinese anode shipments will face far more scrutiny going forward.
Short-Term Cost Shock Versus Long-Term Diversification
The tension at the center of U.S. graphite policy is straightforward: protecting a nascent domestic anode industry requires restricting the cheapest available imports, but those restrictions raise input costs for the very battery factories the government is subsidizing through clean-energy tax credits. A 93.50% preliminary duty on Chinese anode material, if it holds, would force American EV battery assemblers to either absorb sharply higher graphite costs or source from suppliers that do not yet exist at scale outside China. Neither option is painless in the near term, particularly for manufacturers racing to meet price-sensitive demand in mass-market vehicle segments.
Most coverage of critical-mineral policy treats trade enforcement and supply-chain diversification as complementary goals. That framing deserves scrutiny. Duties can shield domestic producers from below-cost competition, but they cannot accelerate mine permitting, refinery construction, or the years of qualification testing that battery makers require before accepting a new anode supplier. The IEA’s projection that China will still control roughly 80% of refining capacity a decade from now reflects the physical and financial reality that building alternative processing at scale takes far longer than imposing a tariff. If duties take effect before alternative supply materializes, the gap will be filled by higher prices rather than by new domestic tons, with EV buyers ultimately bearing part of the cost through higher sticker prices or reduced incentives.
Balancing Security, Affordability, and Innovation
Policymakers now face a sequencing challenge: how to time trade remedies, industrial subsidies, and research investments so that security gains do not undercut affordability before new capacity comes online. The DOE’s criticality findings and the ITC’s trade investigations point in the same direction, toward a desire for more geographically diverse graphite processing, but they operate on very different clocks. Research programs and refinery projects unfold over many years, while trade measures can reshape import flows in a single quarter. Bridging that gap may require transitional arrangements, such as phased duty schedules or carve-outs for volumes tied to domestic cell plants, to avoid sudden shocks to battery costs.
At the same time, the focus on graphite underscores how energy transition supply chains can create new dependencies even as they reduce fossil fuel use. EVs cut tailpipe emissions, but they bind transportation systems to a handful of mineral-processing hubs, with graphite emerging as one of the least substitutable links. The combination of IEA demand projections, DOE risk designations, and aggressive U.S. trade enforcement suggests that graphite will remain a strategic flashpoint in clean-energy policy debates through at least the mid‑2030s. Whether governments can align security, affordability, and innovation fast enough will help determine how quickly EV adoption continues to scale, and how resilient that growth will be when the next supply disruption hits.
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*This article was researched with the help of AI, with human editors creating the final content.
