China’s Unrivaled Dominance in Global Battery Minerals Trade

In 2023, China dominated the global battery minerals trade, controlling 44% of import and 58% of export shares. Key minerals like lithium, graphite, and cobalt are tightly managed, with China leading in both mining and processing capacities. The growing demand for electric vehicles increases the reliance on these minerals, raising concerns about dependency on China’s production and the implications of recent export restrictions.

China continues to assert its dominance in the global battery minerals trade as it remains a crucial player in every step of the battery supply chain. Recent figures show that in 2023, China imported nearly 12 million short tons of both raw and processed battery minerals, accounting for a hefty 44% of interregional trade. On the flip side, China exported around 11 million short tons of battery materials, packs, and components, which translates to 58% of global interregional trade, according to data from the regional UN Comtrade.

Focusing on three pivotal battery minerals—graphite, lithium, and cobalt—the trade dynamics between China and prominent global regions come into sharper focus. These minerals, sourced from both natural and synthetic reserves, are crucial for manufacturing batteries and their components. The rising appetite for electric vehicles and energy technologies continues to boost the demand for these essential materials.

Lithium, which is extracted through methods such as brine extraction and hard rock mining, saw China producing approximately 18% of the mined lithium globally in 2023, equating to about 33,000 short tons. Notably, Chinese firms control about 25% of worldwide lithium mining capacity. The National Geospatial-Intelligence Agency’s Tearline Project highlights significant Chinese investments in mining ventures across Argentina, where they have access to the lithium-rich area known as the lithium triangle that spans Argentina, Bolivia, and Chile.

When it comes to graphite, China is the dominant player, having produced about 79% of the world’s natural graphite by 2024, according to the U.S. Geological Survey. In a stark contrast, the United States did not produce any natural graphite that year. China also leads in cobalt production, controlling roughly 80% of cobalt output from the Democratic Republic of the Congo, where half of the world’s cobalt is sourced.

Once these raw minerals are extracted, they are globally transported for refining. Notable trade figures from 2023 indicated that China comprised 46% of the world’s aggregate raw battery mineral import trade, with Australia—being the largest lithium producer—sending almost all of its exports to China. Across the broader regions of Asia and Oceania, particularly in India and Japan, they made up 71% of the global raw battery mineral import trade for that year.

Moving into battery mineral processing, China is responsible for processing over 90% of the world’s graphite, while also demonstrating dominance in cobalt and lithium processing, holding over two-thirds of the global capacity. In 2023, China imported about 20% of the world’s processed battery minerals, primarily cobalt from Africa, while exporting 58% of processed battery minerals, with a notable share of synthetic graphite going to Asia and Oceania.

Looking ahead, it’s worth noting that in 2023 China introduced export restrictions on graphite products linked to electrode manufacturing. This could translate to decreased graphite exports from China as we move into the next couple of years leading up to 2025.

As for battery materials manufacturing, processed battery minerals serve as the building blocks. In 2023, China accounted for about 53% of the global export trade in battery materials. For context, typical lithium-ion battery cells consist of components such as a graphite anode, lithium-based cathode, and a lithium salt electrolyte. China’s manufacturing capabilities are impressive—85% of global anode production, 82% for electrolytes, 74% for separators, and 70% for cathodes can be traced back to this one nation.

In the battery pack and component sector, China accounted for 74% of all global exports in 2023. Moreover, they controlled nearly 85% of the market share in battery cell production based on monetary value. All these figures clearly illustrate China’s unparalleled position in the battery supply chain and raise questions about the dependency of other regions on its production capabilities, and what might happen if that balance shifts in the future.

In summary, China firmly establishes itself not only as a dominant force in battery mineral production but throughout the entire supply chain. From significant control over lithium, graphite, and cobalt to extensive processing capabilities and battery material manufacturing, China’s grip on the global battery market cannot be overstated. As electric vehicle demand rises, the implications of China’s position will be crucial for global trade dynamics and future supply chain considerations.

Original Source: batteriesnews.com