China Tightens Export Bans on Battery Materials Amid US Tensions

China is tightening its control over the export of technologies related to battery materials in a bid to safeguard its leadership in a vital supply chain. Experts note that this move aligns with China’s broader efforts to counter the growing US restrictions on technology exports to Beijing.

The Chinese Ministry of Commerce has proposed adding technologies used in lithium refining and battery chemical production to its list of items subject to export controls. This proposal, open for public consultation until Feb. 1, underscores Beijing's determination to retain control and dominance in global battery and electric vehicle manufacturing. “This move reflects the government’s recognition of the need to protect advanced lithium technologies. Overseas investments involving these technologies are likely to face increased scrutiny,” said Yu Yakun, Analyst, Cofco Futures Co.

Although the proposal remains open to public feedback and could be subject to changes, it has already prompted companies across Asia to assess its potential impact on the battery supply chain. While current and ongoing projects are unlikely to be affected, future investments, particularly joint ventures with foreign companies, could face significant challenges.

Experts highlight that the newly proposed restrictions closely mirror those implemented last year, which included bans on the export of gallium, germanium, antimony, and superhard materials, as well as stricter regulations on graphite shipments. According to CITIC Securities, these actions signal the beginning of China’s efforts to safeguard national security and enhance its strategic influence over critical resources. China’s restrictions come in the wake of Biden administration’s limitations on the sale of advanced memory chips to China, designed to curb its progress in semiconductor and AI technologies. In addition, Donald Trump has proposed tariffs of up to 60% on Chinese goods, heightening the potential for retaliatory measures from Beijing.

Analysts foresee an increased likelihood of a renewed US-China trade war under Trump’s administration, with Beijing expected to employ export controls as a countermeasure to US tariffs. However, experts point out that further export restrictions could accelerate efforts by the United States and its allies to diversify supply chains, potentially undermining China’s leverage.