Tag: lithium-ion batteries

  • Graphite and the Battery Supply Chain: Why China Controls the Material Inside Every EV

    Every lithium-ion battery has two electrodes — a cathode and an anode. The cathode gets the headlines because it contains the expensive metals: lithium, nickel, cobalt, manganese. The anode is graphite. It is graphite in your phone, graphite in your laptop, graphite in every Tesla and every BYD and every grid-scale storage installation on earth. Graphite constitutes more of a lithium-ion battery by weight than lithium does. And China controls approximately 77 percent of natural graphite mining, more than 90 percent of graphite refining into battery-grade spherical graphite, and — as of October 2025 — has placed the entire category under export controls that give Beijing licensing authority over every kilogram that leaves the country. The material that makes the energy transition physically possible is more supply-concentrated than any other battery input, and the country that controls it has spent the last two years demonstrating exactly how willing it is to use that leverage.

    Why graphite and why now

    Natural graphite is mined. Synthetic graphite is manufactured from petroleum coke at extremely high temperatures. Both end up as anode material in lithium-ion batteries, where graphite’s layered crystal structure allows lithium ions to intercalate — slide between the layers during charging and slide back out during discharge. The process is the fundamental mechanism that makes rechargeable batteries work. Without graphite anodes, there are no lithium-ion batteries. Without lithium-ion batteries, there are no EVs, no grid storage, no portable electronics, no energy transition.

    The supply chain has three chokepoints, and China dominates all of them. First, mining: China produces roughly 77 percent of the world’s natural graphite, with Mozambique, Brazil, and Madagascar as distant secondary sources. Second, processing: mined graphite must be purified, shaped into spherical particles, and coated to function as battery-grade anode material. China controls over 90 percent of this processing — a concentration tighter than its grip on rare earth refining. Third, anode manufacturing: the finished anode components that go into battery cells are overwhelmingly produced in China or by Chinese companies operating abroad. Japan sources 90 percent of its graphite from China. South Korea sources 93 percent of its anode materials from Chinese suppliers. The United States is better diversified on raw graphite imports — 33 percent from China, 21 percent from Mexico, 17 percent from Canada — but on processed battery-grade material, the dependency is nearly as severe.

    The export control escalation

    China’s graphite weaponization has followed the same playbook it used with gallium and germanium: announce controls, let the market panic, then selectively enforce to maintain leverage without fully cutting supply. The timeline tells the story.

    In October 2023, China imposed export permit requirements on natural graphite — both flake graphite and spherical graphite — citing national security. The move was widely interpreted as retaliation for U.S. semiconductor export controls. Export volumes initially dropped but partially recovered as licenses were granted selectively, demonstrating that the controls were a valve, not a wall.

    In October 2025, Beijing escalated dramatically. New export controls effective November 8 expanded the scope to include synthetic (artificial) graphite anode materials, blended graphite anodes, cathode material precursors, high-performance lithium-ion batteries with energy density above 300 watt-hours per kilogram, and — critically — the manufacturing equipment and production technologies required to make all of these things. This wasn’t just restricting the finished product. It was restricting the ability to build the factories that produce the product. Graphitization furnaces, CVD rotary kilns, spray dryers, coating equipment — all now require export licenses. The IEA’s analysis was blunt: these controls “target some critical chokepoints in global battery supply chains” for which “supply options outside China are extremely limited.”

    Then, in November 2025, Beijing temporarily suspended the stricter end-user verification requirements for graphite shipments to the United States, valid through November 2026. The suspension aligned with bilateral trade consultations and followed the pattern China has established with rare earths: tighten, negotiate, offer temporary relief, preserve the structural leverage for future use. The November 2026 expiration date isn’t a formality. It’s a countdown.

    The IRA collision

    The U.S. Inflation Reduction Act created an additional problem that China’s export controls have now weaponized. To qualify for the full $7,500 EV consumer tax credit, manufacturers must demonstrate that critical minerals in their batteries meet “foreign entity of concern” (FEOC) rules — effectively limiting Chinese content in qualifying battery supply chains. The FEOC requirement for graphite was initially exempted until the end of 2026 because the supply chain was so concentrated that enforcing it immediately would have disqualified virtually every EV sold in America.

    Manufacturers scrambled for compliant sources. Several identified BTR — a Chinese graphite company planning to source from Indonesia or Morocco — as a workaround. In January 2025, the Department of Energy classified BTR as a foreign entity of concern and extended that designation to its overseas subsidiaries. The workaround collapsed. The result is a policy that simultaneously demands non-Chinese graphite (via FEOC rules) while operating in a market where non-Chinese processed graphite barely exists at commercial scale.

    What the U.S. is doing about it

    The CHIPS Act critical minerals pivot and the Defense Production Act investments are part of the response, but graphite-specific capacity is further behind than rare earths or lithium. The National Defense Stockpile issued requests for information on graphite in 2025, acknowledging that the U.S. has known deposits but essentially zero commercial production capacity for battery-grade material. Syrah Resources operates a graphite mine in Mozambique and a processing facility in Vidalia, Louisiana — one of the only non-Chinese anode material plants in the Western world — with Department of Energy loan support. Nouveau Monde Graphite in Quebec is developing an integrated mine-to-anode operation. Westwater Resources broke ground on a processing plant in Alabama. But these projects collectively represent a fraction of global demand, and each faces the same timeline problem that haunts every domestic critical minerals play: permitting, construction, commissioning, and ramp-up take years, and China’s export controls take effect immediately.

    The friend-shoring strategy fills part of the gap. Turkey holds 27 percent of global natural graphite reserves. Brazil holds 22 percent. India, Canada, and Mexico are all potential alternative sources for raw material. But the processing bottleneck — converting raw graphite into battery-grade spherical graphite — is the constraint that raw material diversification doesn’t solve. Building a graphite processing facility takes three to five years. China built its processing dominance over three decades.

    The honest picture

    Graphite is the most supply-concentrated critical battery material, more concentrated than lithium, more concentrated than cobalt, more concentrated than nickel. It is in every lithium-ion battery ever manufactured. China controls the mining, the processing, the equipment, the technology, and — since October 2025 — the legal right to restrict all of it. The temporary suspension of enhanced export controls to the United States expires in November 2026. What happens after that depends on the state of U.S.-China trade relations, which at this point is like forecasting the weather on a planet with no atmosphere — the models exist but the inputs are chaos.

    The copper shortage, the helium crisis, the semiconductor supply chain — each teaches the same structural lesson: the materials that modern technology depends on are sourced from fewer places, processed through fewer facilities, and controlled by fewer governments than most people realize. Graphite is the purest expression of that lesson because it’s in everything and nobody talks about it. We cover the full critical minerals landscape — from neodymium magnets to gallium export controls to graphite supply chain concentration — across our Rare Earth Elements course, where the question isn’t whether the supply chain has a single point of failure but how many single points of failure it has simultaneously.

  • Cobalt, Coltan, and Conflict Minerals: The State of Play in 2026

    In January 2025, the M23 rebel group—backed by Rwanda and approximately 10,000 Rwandan troops, according to UN investigators—seized Goma, the capital of North Kivu province in the eastern Democratic Republic of the Congo. More than 3,000 people were killed in less than two weeks of fighting. An estimated 2,400 Congolese soldiers surrendered en masse. Over 150 female inmates were raped and burned to death during a jailbreak in the chaos. M23 then advanced south and captured Nyabibwe, another mining hub, less than a year after seizing Rubaya—a site that harbors one of the world’s largest deposits of coltan and supplies roughly 15 percent of global tantalum production.

    In February 2026, landslides collapsed several artisanal coltan mines at Rubaya, killing at least 227 workers. It was the fourth deadly landslide Global Witness had documented at the site in 18 months. The miners were working in territory controlled by M23. The coltan they extracted was being transported into Rwanda—more than 120 tonnes per month, according to UN experts—where it was laundered and exported as Rwandan product to China, Europe, and the United States. Some of it is in the device you’re reading this on.

    That last sentence isn’t rhetoric. It’s supply chain arithmetic. The DRC produces approximately 70 percent of the world’s cobalt and holds roughly 60 percent of global coltan reserves. These minerals are essential components in the lithium-ion batteries that power electric vehicles, smartphones, laptops, and advanced weapons systems. The International Energy Agency projects that global cobalt demand will quadruple by 2030. The connection between a mine collapse in North Kivu and a phone in your pocket is not metaphorical. It is three to four intermediaries long, and nearly a billion dollars vanishes from the legal supply chain annually through the middlemen who mix illegally sourced minerals with certified ones.

    What conflict minerals actually are

    The term “conflict minerals” refers to tin, tantalum, tungsten, and gold—the “3TGs”—mined in conditions where the proceeds finance armed conflict or the minerals are extracted through forced labor. The designation originates from Section 1502 of the 2010 Dodd-Frank Act, which required U.S.-listed companies to disclose whether their products contained minerals sourced from the DRC or adjoining countries. Cobalt was not included in the original definition, though it arguably should have been—the same armed groups, child labor networks, and supply chain opacity that characterize 3TG extraction apply to cobalt with equal or greater force.

    Coltan—short for columbite-tantalite—is processed into tantalum, a heat-resistant metal used in capacitors for mobile phones, computers, medical equipment, and aerospace components. Cobalt is essential for the cathodes in lithium-ion batteries. Together, these two minerals account for a disproportionate share of the DRC’s strategic value and a disproportionate share of its human suffering. Of the estimated 255,000 Congolese mining cobalt, approximately 40,000 are children, some as young as six, working with hand tools for less than $2 per day.

    The 2025 escalation

    The M23 offensive that captured Goma in January 2025 represented the most serious military escalation in the DRC’s eastern provinces in over two decades. The fall of the provincial capital—home to over a million people—triggered a humanitarian crisis that displaced at least 100,000 from camps in the volatile east on top of the millions already displaced by decades of conflict. M23 and allied forces now control North and South Kivu, bordering Rwanda and Burundi, and much of Ituri province with its lucrative gold mines bordering Uganda.

    The mineral dimension of the conflict is not incidental. A UN official told the Security Council that coltan trade from Rubaya’s mines generates an estimated $300,000 per month in revenue for M23. Updated estimates from other UN reporting suggest the figure may be closer to $800,000 per month. “It’s not a coincidence that the zones occupied by the rebels are mining areas,” said Patrick Okenda, a researcher at Global Witness. “It takes money to wage war. Access to mining sites finances the war.”

    Rwanda’s role is particularly complicated. President Paul Kagame has acknowledged that minerals flow through Rwanda from the DRC but frames it as smuggling rather than state-sponsored extraction. A 2024 UN report documented that Uganda falsely labels DRC-sourced minerals as domestic exports. Between 2020 and 2021, Uganda exported $2.25 billion in gold despite minimal domestic production. The U.S. Treasury Department reported in 2022 that over 90 percent of the DRC’s gold was being smuggled to regional states, particularly Rwanda and Uganda, before being refined and exported to international markets through the UAE.

    The Washington Accords

    The Trump administration intervened directly in the conflict under the framework of securing critical mineral access. In June 2025, Secretary of State Marco Rubio hosted DRC and Rwandan officials to initial a preliminary accord. In December 2025, the Washington Accords for Peace and Prosperity were signed at a presidential summit, witnessed by the leaders of Angola, Kenya, and Burundi.

    The accords explicitly tied peace negotiations to mineral access for U.S. corporations. The Modern War Institute at West Point published an analysis describing the arrangement as a potential “cobalt quagmire,” warning that Washington risked being drawn into a proxy war in some of Africa’s deadliest terrain. The DRC’s President Tshisekedi had solicited a formal security pact—effectively trading mineral access for American military support—and the analysis noted that “factors that make [the DRC] an attractive node in a critical mineral supply strategy, such as resource abundance and a transactional head of state, also make it a risky place to do business.”

    European private military contractors had already failed in the theater. Several hundred Romanian contractors deployed across eastern DRC from 2022 to 2025. When M23 captured Goma, nearly 300 of them were surrounded and captured, paraded before media, and eventually repatriated through Rwanda.

    The export quota system

    In February 2025, the DRC government suspended cobalt exports for four months to address market oversupply—cobalt prices had been depressed by overproduction and reduced demand from battery chemistry shifts toward lithium iron phosphate (LFP) cathodes, which use no cobalt. In October 2025, the government introduced export quotas: companies were allocated specific monthly export volumes, with a 10 percent royalty plus a 5 percent strategic minerals levy. A 9,600-tonne “strategic reserve” was placed under the control of ARECOMS, the DRC’s new mineral regulation authority. Companies that don’t use their full allocations lose them to the government reserve starting January 2026.

    The quota system represents the DRC’s most aggressive move to control its mineral wealth. Industry analysts at CRU Group described it as “a fundamental shift from market-based supply to government-controlled allocation.” The system also mandates electronic tracking of all mineral exports through the Better Sourcing Program, a partnership with RCS Global. Whether the tracking system can actually distinguish legally sourced cobalt from conflict-sourced cobalt in a country where “legal and illegal cobalt quickly mingle,” as the Institute for Security Studies’ Oluwole Ojewale described it, is the question on which the entire framework depends.

    The supply chain problem nobody has solved

    The DRC captures approximately 3 percent of the value in the battery and EV supply chain despite supplying 70 percent of the cobalt. Almost all cobalt mined in the DRC is shipped to China for refining—China processed 77 percent of the world’s cobalt in 2022. The DRC sells raw material. China sells batteries. The value multiplier between the two ends of the chain is roughly 20 to 1.

    The DRC has ambitions to move up the chain. A Bloomberg study identified the DRC as a favorable location for battery precursor production—building a plant there would cost three times less than in the U.S. or China, cut supply-chain emissions by 30 percent, and keep more value in-country. The EU signed strategic partnerships with the DRC and Zambia on critical raw material value chains in 2023. The U.S., DRC, and Zambia signed a memorandum of understanding in 2022 to develop integrated EV battery production. None of these initiatives has yet produced a functioning refinery at scale in the DRC. The infrastructure gap—roads, electricity, skilled labor—remains enormous, and the security situation in the eastern provinces makes investment in processing capacity a proposition that requires either extraordinary risk tolerance or the kind of military guarantee that the Washington Accords are attempting to provide.

    Alternative cobalt sources are in development. Jervois Global’s Idaho Cobalt Operations targets 1,500 tonnes per year with a restart planned for Q2 2026. Fortune Minerals’ NICO Project in Canada has an estimated capacity of 1,728 tonnes per year. Global cobalt production is approximately 130,000 tonnes annually, overwhelmingly from the DRC. The alternative sources represent rounding errors.

    Battery chemistry is shifting. LFP cathodes—which contain no cobalt—are gaining market share, particularly in Chinese EVs and Tesla’s standard-range vehicles. But high-performance applications, particularly long-range EVs and consumer electronics, still require nickel-cobalt-manganese (NCM) or nickel-cobalt-aluminum (NCA) cathodes. Cobalt isn’t going away. The question is whether the supply chain that delivers it can be made less dependent on a country where 227 miners die in a landslide at a site controlled by a rebel militia backed by a neighboring government, and the coltan they extracted still makes it into your phone.

    The honest answer, in 2026, is no. Not yet. Possibly not soon.

    We cover the full geopolitics and chemistry of cobalt, coltan, lithium, and 33 other critical elements across our Rare Earth Elements & Critical Minerals course—including why the supply chain for the green energy transition runs through the deadliest conflict zone on earth.