Shares of China's leading battery manufacturers tumbled Friday after Beijing announced sweeping new export restrictions on lithium-ion batteries and related materials, tightening its control over technologies crucial to global electric-vehicle and energy-storage industries.
The Ministry of Commerce said Thursday that exporters of certain high-performance lithium-ion cells, cathode and anode materials, and processing equipment will need government licenses starting November 8. The measures, justified on national security grounds, follow earlier curbs on rare earth elements and come ahead of a potential meeting between Presidents Donald Trump and Xi Jinping later this month.
Contemporary Amperex Technology Co. Ltd. (CATL) fell 6.82%, Tianqi Lithium dropped 7.17%, and EVE Energy slumped nearly 11%, while BYD slid 2.54% by market close. China's New Energy Vehicles Index also declined 6.02%, extending losses triggered by new rules tightening eligibility for electric-vehicle tax exemptions.
"The new controls drastically expand how much of the lithium battery supply chain China is staking a claim to," said Cory Combs, head of critical mineral research at Trivium China. "Foreign producers or Chinese overseas joint ventures are at risk should Beijing choose to slow-walk and limit export licenses."
The new regulations cover a wide range of "dual-use" products - those with both civilian and military applications - including:
- Battery cells and packs with a weight energy density of 300Wh/kg or higher.
- Lithium iron phosphate (LFP) cathode materials with compacted density ≥2.5g/cm³ and gram capacity ≥156mAh/g.
- Nickel cobalt aluminium (NCA) and nickel cobalt manganese (NCM) precursors.
- Synthetic and natural graphite anodes, along with associated processing technology and equipment.
Exporters will be required to submit detailed business records, trade history, customer lists, and end-user certificates to secure licenses. Approval will be at the discretion of the Ministry of Commerce, which will review applications case by case.
The announcement mirrors last year's restrictions on natural graphite, which temporarily disrupted exports and raised prices as foreign buyers rushed to stockpile supplies before new rules took effect. Analysts at Benchmark Mineral Intelligence said export volumes typically fell for several months afterward as companies adapted to the new licensing system.
Zaoshang Securities analysts said the latest controls are unlikely to amount to a full ban but could create short-term delays. "Exporters will only have to go through a short process," they wrote, noting that prior curbs had limited long-term impact once the market adjusted.
