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Anti-dumping and countervailing duties on battery materials could have serious repercussions on the electric vehicle and energy storage markets, as the battery materials and manufacturing markets in the United States are still in their early stages.
The American Active Anode Material Producers (AAAMP), a coalition of U.S. graphite producers, filed a petition for the imposition of antidumping and countervailing duties (AD/CVD) on imports of active anode materials from China.
The petition filed with the Department of Commerce and the International Trade Commission (ITC) seeks to launch a trade investigation and impose tariffs of up to 920% on materials used in the manufacture of lithium-ion batteries.
An industry note from Roth Capital Partners says such a tariff could have “disruptive and far-reaching implications,” saying the request covers anode active material whether imported into the U.S. separately, in a composite or in a battery.
“We believe the anode typically accounts for 10-15% of a battery’s cost, or ~$15/kWh for a DC block priced at $120/kWh,” said Justin Clare of Roth Capital Partners in an industry note. “If a 900% tariff were applied to the anode, we estimate the incremental cost could be ~$135/kWh, representing a ~125% increase in the DC block to ~$255/kWh.”
“AAAMP is bringing this case to help protect the North American graphite industry, which is at risk of being stifled by China’s malicious trade practices. There is overwhelming evidence that China is dumping artificially cheap graphite into global markets, made possible by state-sponsored policies and massive subsidies,” said Erik Olson, spokesperson for AAAMP.
“Without trade assistance from the U.S. government, the domestic graphite industry is in jeopardy. China’s anti-competitive measures make it difficult for graphite producers to find a secure financial footing, preventing them from establishing themselves in the global market,” Olson said.
AAAMP reports that graphite from China is currently subject to tariffs of 25%, but the group believes the duty should be much higher.
A statement released by AAAMP says that “fueled by state-sponsored industrial policies, low or non-existent wage protections, and a lack of environmental stewardship, recent data shows that China’s excess capacity in the battery industry has quadrupled demand.” It refers to Chinese battery materials as an “excess” that has “stirred markets and significantly impacted prices,” indicating that China is overproducing due to government subsidies.
These tariffs, however, could have serious effects on the electric vehicle and energy storage markets, as the battery manufacturing and materials markets in the United States are still in their early stages. Until a robust battery supply chain is established in the United States, the sector will have to rely on imports.
A hearing is scheduled for January 7, 2025, on the ITCs preliminary investigation with a vote scheduled for January 31, 2025. Commerces preliminary antidumping determination is scheduled for May 26, 2025, and the preliminary countervailing determination is scheduled for March 12, 2025.
The petitioners are American Active Anode Material Producers, Anovion Technologies, Syrah Technologies, Novonix Anode Materials, Epsilon Advanced Materials, and SKI US. The petitioners are represented by Buchanan Ingersoll & Rooney of Washington, DC. |
