China Announced Graphite Export Controls on 20 October 2023: The Six Weeks Before December 1

Historical correction, 9 October 2026: Announcement 39 was issued on 20 October 2023, after this article’s preserved archive date, and took effect on 1 December. The corrected timing below is retrospective. Market quotes, private experience and photograph descriptions remain unverified.

For importers of controlled graphite, MOFCOM Announcement No. 39 followed the gallium and germanium measures announced in July. On October 20, 2023, China’s Ministry of Commerce and the General Administration of Customs jointly published export control measures covering natural flake graphite, spherical graphite, expandable graphite, and several categories of high-purity synthetic graphite. The measures take effect December 1, 2023. From that date, exports of items meeting the announced control criteria require a licence. Not every product containing carbon falls within those criteria.

The scope is broad and the timing is pointed. China produces roughly 65% of the world’s natural graphite and close to 90% of the world’s synthetic graphite, which in practical terms means the anode of nearly every lithium-ion battery on the planet starts its life in a Heilongjiang flake mine or a Shandong calciner. The announcement lists controlled item descriptions and reference customs codes; a broad HS heading alone does not decide coverage. For affected material, the announcement left six weeks to land volume under the old regime, get your long-term contracts restructured around licence availability, and talk to your freight forwarder about what “licence exception” documentation even looks like at Yangshan.

This isn’t a tariff. It’s a licensing chokepoint. This article has not verified licence processing times, approval volumes or end-use priorities. If the gallium and germanium precedent from August and September is any guide, the answer is “slowly, opaquely, and with a strong bias toward buyers who can demonstrate non-military end-use.” Battery and steel customers will probably get through. Boutique graphene R&D buyers will probably not.

What Announcement No. 39 Actually Covers and What It Leaves Alone

The announcement splits graphite into two regulated baskets and one that is partially loosened. The first basket is high-purity, high-strength, high-density synthetic graphite. The official criteria require all three properties together: purity above 99.9%, flexural strength above 30 MPa and density above 1.73 g/cm3. There is no particle-size test in this definition. Assess the actual material against those criteria rather than inferring control from its commercial use alone.

The second basket is natural flake graphite and its downstream products: coated spherical graphite, expanded graphite, and expandable graphite. Coated spherical graphite is the precursor for natural-graphite anodes, and the coatings used by BTR, Shanshan, and Putailai are the main value-added step between a Chinese mine and a Korean or Japanese cell maker. All of that flow is now licence-gated.

What was loosened is worth noting. The measure replaced the temporary controls in 2006 Announcement No. 50. MOFCOM described removing controls on five lower-sensitivity categories, including certain furnace carbon electrodes. This does not establish a blanket natural-flake exemption or a general licence for refractory buyers.

Exporters need licences for shipments meeting the announced control criteria from December 1 onward; a company name alone does not establish whether a particular product is controlled. A 45-working-day processing period would be an unverified planning assumption here, not a guaranteed approval date. Confirm the applicable procedure and timeline before committing to a delivery window. If you’re running a battery plant in Kentucky or a cathode coater in South Carolina that burns 400 tonnes of anode-grade material a month, you cannot afford a February approval window.

What This Means for Your Landed Cost Through the End of 2023

Spot prices for coated spherical graphite were already moving before the announcement. Fastmarkets had anode-grade spherical graphite at USD 3,100 per MT CIF Korea in early September, up from USD 2,850 in June. The article previously described a September 22 price as a reaction to the October 20 announcement. That chronology was wrong. The quoted prices and lead times here have not been independently substantiated.

Here is the landed cost arithmetic for a representative 20-foot container of coated spherical graphite moving from Qingdao to Long Beach using the existing unverified price inputs as an illustration, not evidence of a market reaction to the announcement.

The table illustrates a roughly 15% difference between its entered cost scenarios; it does not establish an observed post-announcement market increase. That does not include the risk premium for a shipment that gets hung up at Qingdao waiting on MOFCOM paperwork. If you ship in December under a licence that gets delayed, you’re paying demurrage on the Chinese side, storage at the port of loading, and, on the US side, you’re running your battery plant on safety stock you probably don’t have.

The Precedent You Should Be Studying: Gallium and Germanium

MOFCOM’s August 1, 2023 gallium and germanium licence regime is the closest historical analogue, and the early data is instructive. In July 2023, the month before controls took effect, China exported 5.15 tonnes of gallium metal and 8.63 tonnes of germanium products. In August, the first month under the new regime, exports fell to zero. Not “low.” Zero. September data released by GACC this week shows 1 tonne of gallium shipped, still roughly 80% below the trailing six-month average.

The licences are being issued. They’re just being issued slowly and selectively. Reuters reported last week that the first batch of gallium export approvals went to a small handful of integrated customers with demonstrable semiconductor or LED end-use, with paperwork that took around 60 days to clear MOFCOM rather than the stated 45-working-day target.

If graphite follows the same pattern, expect December and January Chinese graphite export volumes to be materially lower than recent monthly averages, and expect the licences that do issue to favour large, integrated battery customers with paper trails that prove automotive end-use. Smaller buyers, trading houses, and anyone supplying defence or space applications should plan for significantly longer processing times.

What US and Australian Battery Anode Buyers Should Be Doing This Week

There were 42 calendar days between the October 20 announcement and December 1 commencement. Licence processing time is separate and cannot be inferred from that interval. Here is the action list we’re walking clients through this week.

Expedite every open PO. If you have a confirmed order that can physically ship before November 30, get it on the water. Chinese exporters and forwarders will prioritise pre-December bookings because they can be cleared under the existing regime without the new licence. Expect FOB prices to firm further over October as everyone tries to pull volume forward, but the incremental cost of an extra 5% on FOB is small next to the cost of a stranded licence application in January.

Get a second source qualified. Syrah Resources in Louisiana operates the Vidalia anode facility using Mozambique flake graphite from its Balama mine. Posco Chemical is expanding anode capacity in Sejong. Novonix in Tennessee is ramping synthetic graphite. None of these are drop-in replacements for a Chinese-sourced BOM on day one, but qualification programmes take 12 to 18 months and you should be starting them today, not in March. Under Section 45X as enacted in August 2022, eligible battery cells carried USD 35 per kWh and eligible modules USD 10 per kWh, or USD 45 per kWh for modules without battery cells. Electrode active materials had a separate credit of 10% of production costs. Eligible production and sale conditions applied, including production in the US or its possessions; choosing a non-China anode did not itself establish entitlement. This is the historical statutory structure, not current tax advice.

Restructure your Chinese contracts. Move from volume-committed annual pricing to quarterly nominations with an explicit export-control carve-out. Your Chinese supplier’s legal team will push back, but every Chinese manufacturer’s in-house lawyer has spent September re-drafting these clauses and there is a market-standard form in circulation. The carve-out needs to say that inability to obtain a MOFCOM export licence is a specific excused event, not general force majeure, and it needs to put the burden of licence application on the exporter with a defined cure period.

Document your end-use. MOFCOM’s application form requires detailed end-use disclosures, end-user certificates, and often a statement from the ultimate importer. If you’re the importer, get your customer, or your own production department, to issue an end-use statement naming the facility, the end product, and the commercial application. A vague “industrial use” answer on the application form will get your licence kicked back for clarification and another 20 working days will disappear.

How Australian Importers Fit Into This

If you’re an Australian importer sitting in Melbourne or Brisbane reading this and wondering whether it applies to you, the answer depends on your customer base. Australia does not operate large-scale EV battery cell production, so direct anode imports to Australia are modest. However, quite a lot of Australian-registered trading houses move graphite between China and Korea, China and Japan, and China and the US on back-to-back contracts. If your company is named as the exporter of record on the MOFCOM licence application or as the consignee at Qingdao, you are inside the regulated perimeter regardless of where the material ultimately lands.

The Department of Foreign Affairs and Trade has not issued Australian-side guidance on the new controls yet, but ASIC-registered trading entities doing back-to-back graphite deals should expect their Chinese shipping documents to reference the MOFCOM licence number from December 1 onward. If your documents don’t reference a licence, your freight forwarder in China will not be able to complete export clearance.

The upstream opportunity is real. Australia has the Balama project pipeline through Syrah, Renascor Resources’ Siviour project in South Australia targeting 150,000 tonnes per annum of natural flake graphite, and Magnis Energy Technologies’ downstream anode work. Every non-China qualification programme that gets accelerated this quarter will look at Australian flake as a natural fit with Japanese and Korean anode coaters who are under their own national-security pressure to diversify away from Chinese supply.

The Six-Week Preparation Window, in Dates

After the October 20 announcement: audit every open PO with a Chinese graphite supplier and classify it into three buckets: ships before November 30, ships December or later but licence-critical, or can be cancelled and re-sourced.

Before October 31: send your top three Chinese suppliers a formal request for their licence application timeline and the specific end-use documentation they need from you.

Before November 15: file end-use statements with each supplier, confirm freight bookings for any volume targeting a pre-December 1 load, and audit your sales contracts with downstream customers for force majeure language that might or might not pass through an export-control event.

Before November 30: make sure all pre-regime volume is loaded and bill-of-lading dated on or before November 30. For controlled items, confirm the export declaration and licensing requirements with the exporter; a bill of lading date alone does not establish clearance.

Before December 31: begin formal qualification programmes with at least one non-China source. Balama-Vidalia, Siviour, and Korean-origin synthetic are the first places to look.

If you’ve got a specific PO you’re worried about, send your PO number, load port, and HS classification through our contact form and we’ll walk it through the licence decision tree on a call this week. The announcement-to-commencement window was 42 calendar days, and MOFCOM is not going to wait for anyone.