According to a Reuters report on July 17 local time, the U.S. Department of Commerce announced on that day that it would impose an anti-dumping duty of 93.5% on graphite anodes imported from China. Combined with the existing tariff rates, the effective tariff rate could rise as high as 160%. The department stated that the selling prices of these materials in the U.S. were below their fair market value.

This tariff applies to anode-grade graphite materials with a minimum graphite purity of 90% carbon by weight. These materials are critical components for power batteries. According to the International Energy Agency (IEA), graphite will remain the most mainstream anode material for various lithium-ion batteries in the medium term, while silicon-based materials are not expected to begin gradually capturing market share until around 2030.

Based on 2023 import volumes, the new tariff decree will affect imported products worth approximately US$340 million (about RMB 2.44 billion). According to data from BloombergNEF, last year the U.S. imported 180,000 tons of graphite products, two-thirds of which came from China. The IEA also noted that graphite is one of the critical minerals facing potential supply risks.

In May of this year, the U.S. Department of Commerce launched an independent anti-subsidy investigation into China’s anode-grade graphite materials, claiming that it had determined these graphite products imported from China were subject to “unfair subsidies.”

Since Trump took office at the beginning of this year, the United States has continuously stepped up its export controls on critical minerals and battery technologies from China, while also reducing its investment in the electric-vehicle transition to lessen America’s reliance on Chinese goods and technology. Some analysts suggest that the further increase in tariffs on graphite may be part of this broader strategy. Sam Adham, head of battery materials at the consulting firm CRU Group, said that the additional tariffs imposed by the U.S. on Chinese graphite products will deal a significant blow to battery manufacturers. He analyzed: “A tariff rate of 160% effectively adds an average cost of $7 (about 50.2 yuan) per kilowatt-hour to automotive power batteries. This amount could erode battery manufacturers’ profits for one to two quarters.”

It’s worth noting that when the American Active Anode Material Producers Association proposed launching an investigation into this issue earlier this year, foreign media had already warned that raising tariffs on imported anode materials could deal a severe blow to Tesla, Panasonic, and other companies that rely on these materials and manufacture power batteries and electric vehicles in the United States.