China Sets Sights on Retaining Lithium Processing Dominance

China proposes export restrictions on tech for battery components and minerals lithium and gallium, aiming to maintain global dominance. China's 70% control over lithium processing for EV batteries could be solidified, impacting Western producers dependent on Chinese tech and affecting global battery supply chains.

In a move likely to shake up the global market, China's commerce ministry has put forward a proposal to impose stricter export restrictions on technology integral to the production of battery components and the processing of critical minerals such as lithium and gallium, according to a document released on Thursday.

If these restrictions come into effect, they will add to the series of limitations already impacting the export of essential minerals and related technology, areas where China holds worldwide preeminence. This announcement arrives ahead of Donald Trump's second-term inauguration, during which he is anticipated to pursue aggressive trade tactics, particularly against China.

Adam Webb, head of battery raw materials at consultancy Benchmark Mineral Intelligence, noted that China's move could secure its 70% market share in global lithium processing. This would enable China to control lithium chemical production for its domestic EV battery industry, potentially challenging Western producers reliant on Chinese technologies. Restrictions on gallium tech are also proposed, with public feedback open until February 1.

(With inputs from agencies.)