US Supports Australian Graphite Manufacturer Amid China’s Restrictions on Critical Mineral Exports
The U.S. Department of Energy announced a loan of $754.9 million on December 17 to Novonix, an Australia-based company, for the establishment of a synthetic graphite manufacturing plant in Chattanooga, Tennessee.
“This announcement represents years of dedicated effort and marks a significant milestone for our anode materials division as we aim to reach a production level of 150,000 [tonnes per annum] in North America,” stated Novonix CEO Chris Burns.
He added, “Recent news from China regarding increased scrutiny on the export of battery-grade graphite to the U.S. underscores the necessity for domestic production of high-performance, battery-grade synthetic graphite.”
According to Benchmark Minerals Intelligence, China currently dominates the battery-grade graphite market with a 95 percent share, and it will impose export limitations to the U.S. based on the intended use of the products.
Novonix is a prominent battery materials company based in Brisbane, Australia. The new facility in Tennessee will produce synthetic graphite designated for electric vehicle batteries and is set to commence commercial production next year.
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At maximum output, Novonix anticipates that the facility will produce sufficient synthetic graphite for lithium-ion batteries to power 325,000 electric vehicles annually. The company has already partnered with Panasonic Energy, Stellantis, and PowerCo.
This site will be the first of its kind in North America. In addition to the loan, the Department of Energy previously granted Novonix a $100 million subsidy and a $103 million investment tax credit.
The loan authorization aligns with the United States’ efforts to reduce dependency on China for critical minerals. China currently dominates the global market for mining and processing these essential minerals, which are vital for consumer products and military usage alike.
The Chinese communist regime has historically subsidized and influenced industries to undercut global competitors. According to the report, “The U.S. defense industrial base does not utilize enough of these materials to independently maintain a non-[China] critical mineral supply.”
Some proposed bills also aim to determine where businesses can procure and sell critical minerals.
One piece of legislation seeks to revise the 2018 export regulations concerning recycled battery and magnet materials. The evolving processes of material recovery in recycling, combined with the tendency of Chinese entities to exploit loopholes for obtaining sanctioned materials, necessitate robust laws to limit foreign adversaries’ control over the supply chains for lithium, cobalt, nickel, and batteries, according to the report.
