China's potential black mass import ban lift not seen aiding domestic supply: sources

China's attempt to remove the ban on black mass imports is not expected to boost domestic supply significantly, at least in the short term, industry sources said at a battery recycling conference in China.

Other countries have a small recycling volume and Europe also has export restrictions on black mass, the sources said on the sidelines of the third China International Power Battery Recycling Summit, held over March 27-28.

China on March 4 released a draft import regulation of recycled black mass for lithium batteries, aiming to encourage imports. Black mass, the residue obtained when an end-of-life lithium battery is recycled, helps secure critical minerals such as lithium and cobalt.

Europe exports significant amounts of black mass to Asia and may ease export restrictions eventually, as it cannot use all of the material due to a smaller electric vehicle industry size and environmental risks around storing black mass, sources said.

"The imports of black mass will be 'a drop in the bucket,' in view of the huge appetite at domestic market," a Chinese black mass producer said. The operating rate of domestic recyclers was very low at present, given the tight availability of raw materials and increasing capacity, the source added.

In view of the present situation, Chinese recyclers may be able to collaborate with European and US companies on battery recycling and black mass processing, according to a leading Chinese recycler.

The European Commission updated the list of wastes on March 5 and classified black mass as hazardous waste, to ensure batteries and their critical raw materials remain in the European economy. This would lead to better control of black mass shipments, the commission said.

With a lack of processing capacity, most black mass generated in Europe was usually exported to Asia, mostly to South Korea, which is a key importer and processor of black mass.

China, as the world's largest EV producer and exporter, is aiming to relax its black mass import regulations. Its government said recycled black mass meeting requirements will not be classified as solid waste and can be freely imported.

However, the requirements for imported black mass are still a bit high, according to the specifications mentioned in the March 4 draft released by China. The draft rules cap black mass imports to some extent, while export restrictions by Europe also prove unfavorable for imports, sources said.

China is the world's largest recycling market for lithium-ion batteries used in EVs. Its actual retired lithium-ion battery recycling volume reached 654,000 mt in 2024, up 5% year over year, according to a report released by a Chinese research agency China YiWei Institute of Economics.

Black mass market

Chinese lithium-iron-phosphate black mass prices and nickel-manganese-cobalt black mass payables were rangebound recently, despite improved demand, particularly for NMC black mass.

Demand for LFP black mass remained capped amid fluctuations in downstream chemical prices.

Platts, part of S&P Global Commodity Insights, assessed Chinese LFP black mass at Yuan 3,000/mt ($414/mt) per percent lithium on March 28, unchanged week over week.

Buying interest for NMC black mass continued to grow amid increasing chemical feedstock prices. Some sources on the buy side said it was "not easy to procure [black mass] now."

Platts assessed lithium, nickel and cobalt payables at 75% basis battery-grade lithium carbonate, nickel sulfate and cobalt sulfate, down 1% week over week.

Considering the spot market value of respective battery chemicals, the theoretically calculated all-in price of Ni-Co black mass DDP China stood at Yuan 28,578/mt on March 28, down Yuan 154/mt week over week.