Hong Kong
CNN
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Beijing plans to curb the export of technologies used to extract minerals critical to the growth of the global electric vehicle (EV) industry, as technology rivalry with Washington intensifies ahead of the president’s inauguration elected official of the United States, Donald Trump, later this month.
China also wants to add battery cathode technology to its list of controlled exports, according to an opinion released Thursday by the Department of Commerce seeking public comment, in addition to proposed restrictions on technology related to lithium and gallium production.
If approved, these new additions would form a future series of export controls imposed by China on a large number of critical materials and the technology needed to produce them, which are essential to the manufacture of semiconductors and batteries for electric vehicles.
Asked about the proposal at a regular news conference on Friday, Foreign Ministry spokesman Mao Ning said: “What we can tell you in principle is that China is implementing measures fair, reasonable and non-discriminatory export controls. »
The plan was announced a month after China outright banned the sale of a number of materials crucial to the production of semiconductors and other technologies – including gallium, germanium, antimony and other “super hard” materials – in the United States. This was in response to new export controls on US-made semiconductors imposed by the outgoing Joe Biden administration.
The latest proposal could be a “resource weaponization” strategy to gain bargaining chip ahead of Trump’s second term, Liz Lee, associate director at Counterpoint Research, told CNN.
If implemented, a ban or restriction “could significantly strengthen (China’s) dominance in the battery ecosystem, particularly to boost its electric vehicle battery supply chain,” he said. she declared. “Depending on the level of export controls, this could be problematic for Western lithium producers who want to use Chinese technology to produce lithium, which is one of the basic materials for battery cathodes.”
China dominates the global industry for materials such as gallium, a soft metal commonly used to produce compounds to make radio-frequency chips for cell phones and satellite communications, and lithium, ubiquitous in daily life because it is used to make batteries for everything. from smartphones and laptops to electric vehicles.
Adam Webb, head of battery raw materials at consultancy Benchmark Mineral Intelligence, told the Reuters news agency that China’s proposal would help it maintain its “70% hold” on global processing. lithium.
“These proposed measures would help maintain this high market share and secure lithium chemical production for China’s domestic battery supply chains,” he was quoted as saying.
While an iPhone only needs a small amount of lithium, an average EV battery needs about eight kilograms (18 pounds). That’s why any new restrictions on lithium extraction technology could be particularly important as global demand for electric cars increases. The International Energy Agency said the world is on track to meet just 50% of lithium demand by 2035.
Global demand for lithium-ion batteries is expected to explode over the next 10 years, McKinsey wrote in 2023, with the number of gigawatt hours needed increasing from around 700 in 2022 to around 4,700 in 2030.
Lee said Chinese policymakers will need to consider the global ambitions of Chinese electric vehicle and battery makers when deciding on restrictions, which could trigger retaliation from the West. Electric vehicle giant BYD makes its own batteries and is aggressively expanding overseas, while CATL, the world’s largest battery maker, accounts for 40% of the electric vehicle battery market.
Separately, on Thursday, the Commerce Department added 28 U.S. companies and entities, including major defense contractors Lockheed Martin and Raytheon Missiles & Defense, to its export control list for the first time.
The Export Control List, which regulates the sale of dual-use technologies and is modeled after the US Commerce Department’s “entity list”, was introduced in November.