After the U.S. imposed anti-dumping duties on Chinese graphite products, Indian battery materials company Epsilon has swiftly taken action to expand its business in the U.S. and promote its $650 million plant construction plan.
This August, the Trump administration imposed punitive tariffs as high as 93.5% on Chinese graphite products as part of its efforts to pressure China on trade following his return to the White House, continuing his tough economic and trade policies based on the “Section 301” during his first term. The U.S. believes that China’s monopoly on strategic raw materials such as graphite poses a key risk to the American electric vehicle and energy storage industries, thus hoping to reduce dependence on China by promoting a supply chain through high tariffs.
Graphite is a key material in the production of lithium batteries, and the Chinese Communist Party has long held over 60% of global production capacity and supplies over 90% of the U.S. import volumes. The U.S. Trade Representative’s Office (USTR) pointed out that Chinese companies generally enjoy subsidies and export incentives, leading to price distortions that make it difficult for other countries to compete. The Trump administration’s move aims to create a level playing field for domestic and non-Chinese suppliers.
This policy has presented an opportunity for India’s Epsilon Advanced Materials to challenge Beijing’s monopoly in the global graphite supply chain. Vikram Handa, the CEO of the company, stated in an interview with Reuters, “The U.S. is looking for trustworthy non-Chinese suppliers, and this is our excellent opportunity.”
He emphasized that Epsilon’s graphite anode materials can compete with Chinese products and have production capabilities in line with U.S. localization policies.
The company had announced back in October 2023 its plan to invest $650 million to build a plant in North Carolina. Currently, they are in the process of obtaining environmental permits and construction reviews, with construction not yet started. Handa mentioned that the company is waiting for more customer orders to confirm and considering applying for subsidies under the “Inflation Reduction Act” (IRA).
However, Epsilon still faces challenges in expanding domestically in India. Handa admitted that local battery manufacturers still prefer importing graphite from China due to lower prices and more stable supply. With limited expansion opportunities in the domestic market, Epsilon is choosing to “capitalize on the U.S. market opportunity to break through” and enhance global competitiveness.
According to Bloomberg data, China’s graphite exports exceeded 600,000 metric tons in 2024, with spherical graphite accounting for over 70%. In contrast, India’s export volume is only around 30,000 metric tons, mainly going to Europe and the Middle East. African countries like Mozambique and Tanzania, although rich in natural graphite, still lag behind in mining and processing capabilities.
CNBC suggests that driven by U.S. policies, India, with its “moderate technology and flexible production expansion,” has become one of the most promising non-Chinese sources of graphite in the short term, while the African market, although promising, requires long-term investment and development.
Industry analysts told Reuters that graphite is gradually replaying the “rare earth story”: over a decade ago, China restricted rare earth exports, triggering global alerts. Now, graphite has been classified as a strategic mineral by the United States and the European Union, with supply security becoming a policy priority, and both the U.S. and EU are actively laying out alternative sources to reduce dependence on China.