Editor’s Note
This report is based on information from Hong Kong’s Ming Pao newspaper. The measures mentioned reflect China’s ongoing efforts to regulate the export of strategic materials, which may have significant implications for global supply chains. We will continue to monitor official announcements for further details.
Hong Kong’s Ming Pao reported on the 13th that China plans to impose export controls on high-end lithium-ion batteries and synthetic diamonds starting next month on the 8th, following rare earth elements.
Ming Pao stated that China has been preparing a “trump card” in response to the high tariffs imposed by the Donald Trump administration, and the export control measures on these two items are expected to take effect from the 8th of next month.
Lithium-ion batteries are essential power sources widely used in smartphones, laptops, electric vehicles, power tools, medical devices, and renewable energy storage.
Synthetic diamonds possess the same properties as natural minerals but are more affordable, making them suitable for manufacturing advanced semiconductor chips, polishing ultra-strong materials, and optical equipment for lasers.
In this regard, Russia’s Sputnik news agency analyzed that China aims to leverage its position as a major producer and supplier of synthetic diamonds to control supply chains like those for U.S. computer chips.
The agency reported that the export controls on synthetic diamonds are a response to recent U.S. moves to ban the export of wafer manufacturing equipment to China.
According to the U.S. Geological Survey, from 2020 to 2023, China supplied 77% of the synthetic diamond powder consumed in the United States.
Bloomberg predicted that if China’s lithium-ion battery export controls materialize, they would have a significant impact on the U.S. battery supply chain.
In fact, from January to July this year, Chinese-made lithium-ion batteries accounted for 65% of U.S. imports.
Previously, China halted imports of U.S. soybeans, announced plans on the 9th to strengthen export controls on rare earth alloys, and initiated an antitrust investigation to block U.S. semiconductor company Qualcomm’s acquisition of the automotive semiconductor design firm (fabless) ‘Autotalks’.
In response to China’s offensive, President Trump fired back on the 10th (local time) with proposals for super-high tariffs on China (an additional 100% on existing tariffs) and controls on exports of core software (both to take effect on November 1st). Attention is now on whether there will be a counter-response to the lithium battery and synthetic diamond export controls.
Amid this atmosphere, there is a growing possibility that the anticipated U.S.-China summit between President Trump and Chinese President Xi Jinping, which was hoped for around the APEC leaders’ meeting in Gyeongju starting on the 31st, may not materialize.
Diplomatic circles analyze that both the U.S. and China are intensifying pressure on each other to gain an advantageous position in trade negotiations ahead of the expiration of the second tariff truce on November 10th.
