Currently, China is the world’s largest producer of natural graphite.

In recent years, a comprehensive natural graphite industrial chain has been established nationwide, covering the entire value chain from mining and ore dressing to processing, purification, and the production of finished products.

01. Natural graphite resources

Natural graphite, as its name suggests, is graphite that forms naturally in the environment. It typically occurs in ores such as graphite schist, graphite gneiss, graphite-bearing schists, and metamorphic shale.

According to available data, as of the end of 2021, the globally accumulated proven and recoverable reserves of natural graphite totaled 3.248 billion tons. Among the proven reserves, Turkey boasts the richest graphite resources, with reserves of approximately 90 million tons, accounting for about 27.7% of the global total. China ranks second, with reserves of roughly 73 million tons, representing about 22.48% of the global total. Additionally, the graphite reserves in Madagascar, Tanzania, and Mozambique have rapidly increased to 68 million tons, making this region the fastest-growing area for global graphite reserves.

Currently, more than half of China's natural graphite resources are crystalline graphite, which is primarily concentrated in regions such as Heilongjiang, Shandong, Inner Mongolia, Shanxi, and Henan.

Among them, Heilongjiang accounts for 47% of the world’s crystalline graphite ore reserves, making it the largest distribution area for crystalline graphite ore resources; Inner Mongolia accounts for 19%, and these two provinces together hold 66% of the nation’s total reserves.

02. Industry Chain Structure Analysis

Natural graphite can be classified into two types according to its crystalline form: crystalline graphite (flake graphite) and cryptocrystalline graphite (earthly graphite).

Under current technological and economic conditions, crystalline graphite has broader applications and higher resource value and strategic significance.

Crystalline graphite can be further classified according to its fixed carbon content into high-purity graphite (fixed carbon content ≥99.9%), high-carbon graphite (fixed carbon content 94%–99.9%), medium-carbon graphite (fixed carbon content 80%–94%), and low-carbon graphite (fixed carbon content 50%–80%).

China is a major country rich in graphite resources and one of the few nations in the world that possesses both crystalline graphite and cryptocrystalline graphite.

The natural graphite industry chain mainly comprises four stages: graphite resource exploration, deep processing, product application, and waste management. These stages correspond to a product chain that includes raw-material-grade products, material-grade products, application-grade products, and products resulting from comprehensive resource utilization.

In terms of manufacturing processes, the production of natural graphite mainly involves four major stages: purification, modification, mixing, and carbonization. Compared to synthetic graphite, natural graphite has lower production costs because it does not require the graphitization step.

Primary graphite processing is a manufacturing process that uses graphite concentrate as a raw material and employs relatively simple physical or chemical methods to produce graphite products that require further processing before they can be used as materials.

The primary processed graphite products include high-carbon graphite (excluding high-carbon graphite obtained through ore dressing), high-purity graphite, expandable graphite, spherical graphite, and carbon additives for steelmaking.

Deep processing of graphite is a manufacturing process that uses graphite concentrates or initially processed products as raw materials and involves relatively complex procedures to produce materials for end-use devices, components, and processes.

03. Graphite Products in China

In the field of primary graphite processing, China is the world’s leading producer of primary graphite products, accounting for approximately 80% of global output. Primary-processing enterprises in China are large-scale and technologically advanced, and their technologies for producing expandable graphite and spherical graphite are among the most advanced in the world.

In the field of advanced graphite processing, a wide variety of deep-processing products are available. Among those with relatively large production volumes are negative electrode materials, diamond, flexible graphite, fluorinated graphite, graphite emulsion, micronized graphite powder, lubricants, abrasives, conductive materials, and graphene.

China is also a major global producer of negative electrode materials, diamonds, flexible graphite, micronized graphite, graphene, and other related products. Specifically, China’s output of negative electrode materials accounts for more than 70% of the global total, its diamond production accounts for 95% of the global total, and its output of graphite-containing magnesia-carbon bricks and carbon bricks accounts for approximately 60% of the global total.

From the perspective of the domestic market demand structure, the proportion of natural graphite used in metallurgical casting and refractory materials has noticeably declined, while its share in fields such as sealing materials, negative electrode materials, and conductive materials continues to rise.

04. Development Trends in the Graphite Industry

Recently, China has been committed to improving and upgrading the graphite industry by establishing a regulatory framework.

In 2020, the Ministry of Industry and Information Technology issued an announcement on the “Standardized Conditions for the Graphite Industry,” setting higher requirements for the graphite industry in terms of processing technology, product quality, and resource conservation.

In terms of the downstream graphite industry, layers of policies are providing encouragement and support.

Graphite and graphene materials, primarily made from graphite, are widely used in many fields—including next-generation information technology, energy-saving and new-energy vehicles, power equipment, and advanced materials—and represent a key development area supported by the “Made in China 2025” initiative.

Driven by policy incentives and technological advancements, the market demand for graphite applications in the electric vehicle sector will continue to rise.

The application scope is broad, and downstream demand is growing. A major use of natural graphite is in the production of refractory materials, closely linking graphite demand to metallurgy and steelmaking, chemical engineering, petrochemicals, machinery manufacturing, acid-salt industries, power generation, and other industrial sectors.

Since the metallurgy and steel industries will continue to maintain their fundamental position in economic development, future demand for graphite will remain substantial.

Today, advanced processing technologies for high-end products are rapidly developing, and high-end graphite products have become indispensable key materials for strategic emerging industries such as aerospace, nuclear energy, new-energy vehicles, energy storage, environmental protection, new materials, and others.

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