Graphite and Vehicles, ships, rail, aircraft

Almost every electric vehicle battery uses a graphite anode, and graphite is the largest material in a lithium-ion cell by weight, while China makes over 95% of battery-grade graphite and has licensed its exports since December 2023, so anode supply is a direct risk for carmakers.

Graphite (commodity) and Vehicles, ships, rail, aircraft (industry): 3 relationships.

How they are linked

1. Battery anode

Physical flow · Strong · Graphite to vehicle batteries

Lithium-ion cells store lithium in a graphite anode during charging, and graphite is used in virtually all EV battery anodes; the site rates graphite 5 of 5 on criticality for EV battery cell and materials makers.

• 20 to 30% graphite's share of a lithium-ion battery by weight
• about 70 kg graphite in an average plug-in EV, about 10 kg in a hybrid, 2022 estimate
• almost half LFP's share of the global EV battery market, 2024

Graphite is the largest single component of a lithium-ion battery by weight, so the volume of graphite a carmaker needs scales with the kilowatt-hours it fits. The shift from nickel-rich cells to lithium iron phosphate, which made up almost half of EV batteries in 2024, changes the cathode but not the anode, so graphite demand follows battery output whatever the cathode chemistry.

Enterprise types that depend on it:

• EV battery cell and materials makers: anodes (criticality 5 of 5)

Sources: Material Insights; Mining.com; IEA; Engineering News (Reuters)

2. Chinese anode supply and controls

Shared risk · Strong · China's graphite export rules reach vehicle battery supply

China mines most natural graphite and does nearly all the purification, shaping and coating that turn natural or synthetic graphite into anode material, so its export permits decide how much anode material battery makers elsewhere can buy.

• over 95% China's share of battery-grade graphite production, 2024
• 67% China's share of world natural graphite supply, 2023
• 1 December 2023 start of Chinese export permits for high-purity synthetic and natural flake graphite

China said in October 2023 that it refines more than 90% of the world's graphite into anode material, and from 1 December 2023 exporters needed permits. On 9 October 2025 it added controls on artificial graphite anode material and the equipment and know-how to make it, then suspended those new measures from 7 November 2025 to 10 November 2026. The 2023 permit system was not part of that suspension.

Sources: IEA; Engineering News (Reuters); SMM; Global Times

3. India anode build-out

Policy · High in India · Indian incentives target domestic anode capacity for vehicle batteries

India's battery cell plants need anode material that would otherwise come from China, so the government is co-funding domestic graphite anode capacity under its electronics components scheme.

• ₹145 crore capex support approved for Epsilon's anode project, August 2026
• 30,000 t a year planned anode capacity by 2028, in Karnataka

The support covers 25% of the project's capital cost under the Electronics Components Manufacturing Scheme, and the company plans a second phase of 100,000 tonnes a year. Until such plants run, Indian cell makers must buy anode material from a market in which China makes over 95% of battery-grade graphite, so they remain exposed to Chinese licensing.

Sources: IEA; Business Today

For investors

Key learnings

1. Graphite demand moves with battery kilowatt-hours, not with the cathode choice, so the shift to LFP does not reduce it.
2. China's 2025 anode controls are suspended only until 10 November 2026, so supply terms for non-Chinese battery makers could tighten again at short notice.
3. Anode plants outside China, such as India's planned 30,000 tonnes a year by 2028, gain value from policy support and buyers' wish for non-Chinese supply.

What to track

• China MOFCOM notices on graphite and anode export controls: Reinstatement after the one-year suspension would restrict anode supply (As announced · MOFCOM)
• China's monthly exports of graphite and anode material: Falls signal licence tightening before battery makers report shortages (Monthly · China customs (GACC))
• Spherical and synthetic anode graphite prices, China versus ex-China: A widening premium shows the cost of non-Chinese supply (Weekly · Benchmark, Fastmarkets, SMM)

For policymakers

Key learnings

1. China's share of battery-grade graphite, over 95% in 2024, is higher than its share of mined graphite, so processing capacity is the gap to close.
2. India's anode support under the components scheme addresses the right step of the chain, but plants commissioning in 2028 leave several years of import exposure.
3. Graphite controls have come in steps, permits in 2023 and anode technology in 2025, so policy should plan for repeated tightening rather than a single shock.

What to track

• Commissioning of Indian anode material plants: Delays extend dependence on imported anode material (Quarterly · MeitY ECMS approvals, company filings)
• India's imports of graphite and anode material by source: A falling China share shows diversification is working (Monthly · Commerce ministry TradeStat)

India

India is building graphite anode capacity: in August 2026 the government approved ₹145 crore of support for Epsilon's 30,000 tonne a year anode plant in Karnataka, due by early 2028.

Sources

1. Vehicles, ships, rail, aircraft: materials, Material Insights (2026)
2. Graphite deficit starting this year, as demand for EV battery anode ingredient exceeds supply, Mining.com (2022)
3. Global Critical Minerals Outlook 2025 (extract), IEA (2025)
4. China, world's top graphite producer, to curb exports of key battery material, Engineering News (Reuters) (2023)
5. China suspends lithium battery and material export controls for one year, SMM (2025)
6. Epsilon's lithium-ion battery anode project gets government nod, Business Today (2026)
7. China suspends implementation of certain export control measures involving rare earths, lithium batteries and other critical resources: MOFCOM, Global Times (2025)