US officials unveiled 93.5% import duties on Chinese graphite Thursday, escalating tensions over electric vehicle supply chains just 48 hours after Beijing imposed restrictions on battery technology exports.
The Commerce Department’s anti-dumping decision affects approximately 180,000 metric tons of annual graphite shipments from China, which account for nearly two-thirds of US consumption of the critical battery material. Combined with existing penalties, total tariffs will reach 160%.
The American Active Anode Material Producers coalition initiated the case last December, claiming Chinese manufacturers engaged in unfair pricing practices through government subsidies. Federal investigators determined that Chinese firms sold graphite below fair market prices in the United States.
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“Commerce’s determination proves that China is selling AAM at less than fair value into the domestic market,” said Erik Olson, representing the producer group.
Tesla and supplier Panasonic had opposed the duties, arguing that US companies cannot yet produce sufficient quantities meeting automotive specifications. Following the announcement, Tesla shares dropped 0.7%.
Beijing controls roughly 70% of global graphite mining and more than 90% of processing operations required for battery-grade materials. Energy officials have warned that this concentration creates supply vulnerabilities requiring urgent diversification efforts.
The preliminary duties become effective immediately but await final review by December 5. The ruling may substantially raise costs for vehicle manufacturers and energy storage companies dependent on Chinese graphite.
American graphite companies celebrated the decision, with Westwater Resources gaining 15% while Canadian producers Nouveau Monde Graphite and Northern Graphite recorded similar increases.
Market experts caution that the tariffs might slow US electric vehicle growth by inflating battery prices, potentially hampering climate objectives and clean energy transitions.
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