The U.S. Department of Commerce has preliminarily ruled to impose a 93.5% anti-dumping duty on key battery material graphite imported from China, citing unfair subsidies provided to these materials.
According to Bloomberg, the U.S. Department of Commerce stated in its preliminary determination released on Thursday that the final ruling should be announced by December 5.
The American Active Anode Materials Producers Association (AAAMP), representing U.S. graphite producers, stated that the new tariffs on graphite by the U.S. would compound on top of existing tariff rates, resulting in an effective tariff of 160%.
The imposition of anti-dumping duties on graphite is expected to exacerbate tensions in the global electric vehicle supply chain, which is already facing export controls by Beijing on some key minerals and battery technologies. This move could also lead to increased costs for automakers who rely on this material for manufacturing electric vehicles.
Sam Adham, Director of Battery Materials at consultancy firm CRU Group, mentioned that this tariff would impact battery manufacturers. He stated that the 160% tariff would equate to a $7 cost increase per kilowatt-hour for standard electric vehicle batteries or one-fifth of the U.S. battery manufacturing tax credit.
In December last year, the AAAMP submitted a written request to two federal agencies, calling for an investigation into whether Chinese companies were selling battery-grade graphite at prices below fair market value, thus violating anti-dumping laws.
The association also urged the International Trade Commission to determine whether China’s industrial policies encouraged overproduction of graphite and provided substantial subsidies, artificially lowering prices and causing significant harm to the North American graphite industry.
China is the primary producer of graphite globally, supplying over 90% of anode materials worldwide. According to data from consultancy firm Capstone LLC, the U.S. is heavily reliant on imports of graphite from China, with around 59% of natural graphite and 68% of synthetic graphite coming from China. This high level of dependence has raised concerns among policymakers and has become a critical issue for supply chain security.