Did you know?From December 1, 2023, China has imposed export controls on graphite items, which means that countries such as Japan and South Korea will have difficulty importing this important raw material used to make batteries from China. This is a huge blow to the battery industry in Japan and South Korea, and even the entire new energy vehicle industry. Why does China have export controls on graphite?How much impact will this have on the economies of Japan and South Korea?What is the strategic intention behind China's export controls?
With the development of new energy vehicles, the demand for graphite is also increasing. According to the International Energy Agency, the demand for graphite in 2022 increased by 15% compared to the previous year, with the demand for minerals related to the production of electric vehicles increasing year on year. This year, the demand for graphite has increased by 25 times.
China is the world's largest graphite producer and exporter, with abundant graphite resources and advanced graphite processing technology, and exports a large amount of natural graphite and artificial graphite to foreign countries every year. According to the U.S. Geological Survey, China accounts for 70% of the world's total graphite production, and the production of synthetic graphite is also large. For a long time, China has been exporting graphite to foreign countries at a low level, providing stable raw materials for the global battery industry.
So why does China have export controls on graphite?According to the announcement of the Ministry of Commerce of China, the purpose of China's export control of graphite is to safeguard the interests and fulfill international obligations such as non-proliferation. Specifically, there are several reasons:
First of all, graphite is a dual-use item with military use, which can be used to make missiles, nuclear and other mass destruction** and their delivery vehicles. If graphite is obtained by lawbreakers or hostile forces, it may pose a threat to China's interests and interests. Therefore, it is necessary for China to implement export controls on graphite to prevent the spread and abuse of graphite, fulfill its international non-proliferation obligations, and maintain world peace.
Secondly, graphite is a finite resource, and mining graphite also means a large environmental cost, which, if not controlled, may lead to the depletion of graphite resources and the destruction of the ecological environment. Therefore, it is necessary for China to control the export of graphite, realize the protection and rational use of limited resources, promote green development, and build an ecological civilization.
In addition, graphite is a raw material with strategic value, which plays an important supporting role in China's new energy vehicle industry, especially the battery industry. If left unchecked, it may lead to the monopoly of China's graphite resources by foreign companies, affecting China's industrial security and competitiveness. Therefore, it is necessary for China to control the export of graphite, protect the quality of domestic graphite, support the development of the domestic battery industry, and enhance the country's innovation ability and core competitiveness.
Finally, graphite is an important means of countering the unfair and unreasonable pressure that China faces in the international community. If left unchecked, it may lead to China being in a passive and disadvantaged position in the first friction, harming China's national interests and dignity. Therefore, it is necessary for China to control graphite exports, take reciprocal measures against any country or region according to the actual situation, safeguard national sovereignty and legitimate rights and interests, and safeguard the international order and multilateral system.
As soon as the news of China's graphite export control was announced, it aroused great concern and tension in Japan and South Korea. Because Japan and South Korea are both important players in the global battery industry, and both are highly dependent on Chinese graphite**. According to the Nihon Keizai Shimbun, 90% of Japan's graphite imports come from China, while 80% of South Korea's graphite imports come from China. If China controls graphite exports, the battery industry in Japan and South Korea will face serious raw material shortages and costs**, and may even lead to a decline in battery production capacity and loss of market share.
The battery industry in Japan and South Korea is mainly concentrated in two fields: lithium-ion batteries and solid-state batteries. Lithium-ion batteries are currently the most mainstream battery technology, widely used in mobile phones, laptops, electric vehicles and other products. Solid-state battery is an emerging battery technology with advantages such as higher energy density, longer life, and better safety, and is considered to be the development direction of battery technology in the future. Japan and South Korea have strong competitiveness in both fields and occupy an important position in the global battery market. According to statistics, in 2022, Japan and South Korea will have a share of 18% and 32% of the global lithium-ion battery market, respectively, while the share of the global solid-state battery market is 25% and 35%, respectively.
However, China's export controls on graphite could deal a fatal blow to the battery industries in Japan and South Korea. Because graphite is the core material of batteries, without graphite, there is no battery. If Japan and South Korea cannot import enough graphite from China, they will not be able to ensure the production and quality of batteries, they will not be able to meet the needs and expectations of the market, they will not be able to compete with battery companies in other countries, and they will not be able to maintain the development and growth of the battery industry.
Moreover, China's export control of graphite will not only affect the battery industry in Japan and South Korea, but also the new energy vehicle industry in Japan and South Korea. Because the core component of new energy vehicles is the battery, without the battery, there will be no new energy vehicles. If Japan and South Korea cannot import enough graphite from China, they will not be able to ensure the production and performance of new energy vehicles, they will not be able to meet the needs and preferences of consumers, they will not be able to compete with new energy vehicle companies in other countries, and they will not be able to maintain the development and growth of the new energy vehicle industry.
It can be said that China's export control of graphite is a huge impact and challenge to the economies of Japan and South Korea. The battery industry and new energy vehicle industry in Japan and South Korea are the pillars and highlights of their economies, the pride and self-confidence of their countries, and their international competitiveness and influence. If these two industries are affected by China's export controls, the economies of Japan and South Korea will be hit hard, the countries of Japan and South Korea will be hit, and the international communities of Japan and South Korea will be weakened.
Therefore, the reaction of Japan and South Korea to China's export controls is very nervous and anxious. Enterprises in Japan and South Korea are actively seeking solutions to deal with them, but this is not easy. Because behind China's export controls, there is a deeper strategic intention.