On October 9, Binhai Energy announced a new investment plan for anode materials. The company plans to jointly invest CNY 1 billion with its controlling shareholder, Risun Group, to establish a joint venture in Shangdu County, Ulanqab City, Inner Mongolia, to build an integrated anode material project and supporting green power project.
Specifically, Binhai Energy will subscribe for CNY 515 million, holding a 51.5% stake; Risun Group will subscribe for CNY 485 million, holding a 48.5% stake.
Prior to this, Shanshan Co., Ltd. and Keda Manufacturing had just disclosed two large-scale expansion plans in late September: the former plans to invest CNY 5.106 billion to build a 150,000-ton integrated anode material project in Baotou, Inner Mongolia, with an additional 50,000 tons of graphitization capacity;
the latter plans to invest approximately CNY 4.5 billion to build a 500,000-ton integrated graphite anode material project in Baotou. The two investments total over CNY 9.6 billion, adding a planned anode material capacity of 650,000 tons.
From the perspective of project scale alone, this is already a rather aggressive round of expansion.
The particularity of this round of expansion lies in the fact that graphitization, a key process in anode material manufacturing, has once again become the focus of corporate competition.
Shanshan explicitly stated that the 50,000 tons of graphitization capacity supporting the new project will be used to make up for the processing gap of the existing Jiuyuan plant; Keda emphasized its trackless mobile graphitization 3.0 technology, as well as Inner Mongolia's cost advantages in energy, raw material supply, and transportation.
Risun Group's layout goes a step further, placing anode manufacturing and new energy power projects within the same industrial planning framework.
At the same time, another group of anode companies is experiencing a completely different business situation.
In the first half of 2026, Shangtai Technology's anode sales volume increased by more than 40% year-on-year, but its net profit attributable to the parent company decreased by 16.6%; ZKE's lithium battery material business revenue grew by 44.29%, while its gross profit margin decreased by 9.60 percentage points during the same period.
Both companies mentioned in their financial reports that the rising costs of outsourced graphitization processing and related production costs are squeezing profits.
On one hand, traditional anode companies are seeing order growth and manufacturing cost pressure; on the other hand, companies with backgrounds in coking and chemicals are entering the market with capital, energy resources, and new processes.
After years of overcapacity, China's anode industry is seeing an opportunity for a new round of competitive landscape adjustment.
From extending graphitization processing to upstream and downstream, to incorporating raw materials and electricity into the same production system, the boundaries of anode company integration are expanding.
The material technology, manufacturing experience, and customer relationships accumulated by traditional companies over the years remain important, while energy costs and industrial engineering capabilities are becoming another set of chips for new entrants to compete for market share.
01 Graphitization Becomes Tight Again, Traditional Anode Companies Face Cost Repercussions
The tightness of graphitization is not the first time it has appeared in China's anode industry.
In 2017, Shanshan Co., Ltd. announced an investment of approximately CNY 3.8 billion to build a 100,000-ton integrated anode material base in Baotou, Inner Mongolia, covering five major processes from raw material processing, green material processing, graphitization, carbonization to finished product processing.
At that time, the company had explicitly proposed to use Baotou's low electricity price advantage to reduce graphitization costs. In 2019, the first phase of the base was put into operation, forming a graphitization processing capacity of 50,000 tons.
Shangtai Technology, on the other hand, took a different development path relying on graphitization. The company initially engaged in graphitization processing, and then extended to synthetic graphite anode materials, gradually forming an integrated capability from front-end processing to graphitization and finished product manufacturing.
This means that leading anode companies recognized the importance of graphitization very early on. Over the past decade, they have continuously increased their proportion of in-house graphitization, and some companies have also supplemented capacity through long-term cooperation and outsourced processing.
However, the industry has not fully shifted to in-house graphitization, and the core reason is that the capital investment and operational risks in different links are not the same.
Graphitization is a heat treatment process with high power consumption and high capital investment. Synthetic graphite needs to undergo high-temperature treatment close to 3000°C to obtain the crystal structure required for batteries.
The construction of graphitization production lines involves furnace bodies, power supply and distribution, environmental protection, and auxiliary facilities. Large-scale investments usually take several years to complete construction and capacity ramp-up.
When demand is insufficient, companies still need to bear equipment depreciation, capital costs, and fixed personnel expenditures.
In the past, professional division of labor provided a more flexible way of operation.
Some anode companies can invest more funds in material R&D, product design, and customer development, and then purchase graphitization processing services from third parties; some graphitization companies rely on processing scale, electricity prices, and equipment operating efficiency to make profits.
Especially during the industry downturn from 2023 to 2025, a large amount of processing capacity was oversupplied, outsourced processing prices continued to be under pressure, and self-built capacity was not necessarily more economical than outsourcing.
This model faces new tests in 2026.
According to GGII data, in the first half of 2026, China's anode material shipments reached 1.91 million tons, a year-on-year increase of 48%, and the industry capacity utilization rate increased from 70% in 2025 to over 80%.
Among them, energy storage battery shipments were about 485GWh, a year-on-year increase of over 80%, becoming the main source of demand growth for anode materials.
At the same time, the fast-charging upgrade of power batteries, the electrification of commercial vehicles, and export growth continue to support anode demand.
Energy storage cells are accelerating the iteration to large-capacity products above 500Ah.
In June, in the framework procurement of energy storage cells released by NARI Technology, the procurement scale of 587Ah cells reached about 2GWh; China Huaneng also previously separately divided the demand for cells above 450Ah in energy storage system procurement.
Large capacity, coupled with the expansion of energy storage project scale and increased requirements for long cycle life and consistency, is driving anode companies to increase effective capacity and adjust product structures.
For anode materials, rapidly expanding orders first need to pass through the graphitization production process.
Compared with front-end crushing, granulation, and back-end processing, graphitization equipment has a longer construction cycle, and product quality is also affected by furnace temperature uniformity, heat treatment time, furnace loading methods, and impurity control. Capacities of different specifications cannot completely replace each other.
The timeline of industry supply and demand changes is quite clear.
In January 2026, monitoring data from institutions showed that the graphitization processing fee for crucible furnaces was CNY 8,500-9,500/ton, and for box furnaces it was CNY 7,500-8,500/ton. The industry was still constrained by overcapacity.
At that time, due to high electricity prices during the dry season and poor processing profits in the southwest region, most independent graphitization outsourced companies suspended production, while northern processing plants maintained a large number of orders.
By late September, the processing fee for crucible furnaces had risen to CNY 9,500-10,500/ton, and for box furnaces it had risen to CNY 8,500-9,500/ton. The corresponding effective capacity utilization rate of graphitization was relatively high, and the remaining processable capacity was small.
Comparing the quotation ranges of the two types of furnaces, the processing fee shifted upward by about CNY 1,000/ton overall from the beginning of the year to late September.
This round of changes has a strong periodicity. Previously, processing prices were too low, and independent processing plants lacked the motivation to resume production and expand production; in 2026, demand recovered rapidly, and anode companies whose own capacity could not cover order growth increased outsourced procurement, driving the limited effective processing capacity to become tight again.
Even if some suspended capacities resume operation, they still need to solve problems such as equipment, personnel, costs, and customer quality certification, making it difficult to immediately transform into effective supply.
But for anode manufacturers, supply and demand changes have already been directly reflected in financial statements.
In the first half of 2026, Shangtai Technology achieved anode material revenue of CNY 4.128 billion, a year-on-year increase of 33.08%, and anode material sales volume reached 199,000 tons, a year-on-year increase of over 40%.
During the same period, the operating cost of anode materials increased by 46.52%, the gross profit margin decreased by 7.73 percentage points to 15.64%, and the company's net profit attributable to the parent company decreased by 16.60% year-on-year to CNY 400 million.
Shangtai explicitly explained in its semi-annual report that affected by geopolitical conflicts and fluctuations in bulk commodity prices, the prices of upstream coke raw materials rose; at the same time, the prices of outsourced graphitization increased significantly, and the company greatly increased the proportion of outsourced processing procurement to meet order demands.
Due to the slow adjustment of anode product prices compared to the rise in upstream costs, profit margins have been squeezed.
ZKE faces a similar situation. In the first half of 2026, its graphite anode material business revenue was CNY 4.85 billion, a year-on-year increase of 44.84%, but operating costs increased by 64.33%, and the gross profit margin decreased by 10.65 percentage points to 10.18%.
The company explicitly pointed out that raw material price fluctuations and the expansion of outsourced processing scale have pushed up comprehensive costs, and it is accelerating the construction of the second phase of the 100,000-ton integrated project in Yunnan and the 300,000-ton integrated project in Luzhou, Sichuan, to improve the self-sufficiency rate of graphitization.
As a pioneer in the integration of synthetic graphite anodes, Shangtai cannot completely resist the rise in processing fees; although ZKE has continuously laid out integrated bases, it also needs to face the pressure of its own capacity expansion lagging behind order growth.
Both companies are actively expanding production, but before new capacity forms stable supply, they need to bear the impact of rising outsourced processing costs.
The graphitization tightness in 2026 thus presents a different side from the traditional industry prosperity cycle: demand prosperity has not simultaneously improved the profitability of all anode companies, and some new orders have instead increased external processing costs.
However, the business performance of different anode companies has begun to diverge.
Putailai's anode business, including Jiangxi Z宸, achieved sales volume of 95,200 tons in the first half of the year, a year-on-year increase of 37.45%.
The company disclosed that it controlled costs in the first quarter through measures such as graphitization technical transformation and power transmission curve optimization, but in the second quarter, affected by the rise in crude oil and shipping prices, the costs of needle coke and petroleum coke continued to increase, coupled with the capacity ramp-up of Sichuan Z宸, cost pressure increased somewhat. The company began to promote product price adjustments starting in June.
Xiangfenghua, on the other hand, showed a different trend. In the first half of 2026, its anode material revenue increased by 59.23% year-on-year, the gross profit margin reached 18.61%, a year-on-year increase of 6.25 percentage points, and the capacity utilization rate was about 90.17%. Existing financial reports are not sufficient to directly attribute the profit improvement to graphitization self-supply capabilities, but this performance already shows that the cost pressure in the anode industry has not been evenly transmitted to all companies.
The rise in raw material prices has added another force to this round of adjustment.
Since 2026, geopolitical conflicts and fluctuations in the crude oil and shipping markets have pushed up the costs of some petroleum-based raw materials.
Carbon materials such as petroleum coke and needle coke are important precursors for synthetic graphite anodes, and their price changes directly affect anode manufacturing costs. The simultaneous occurrence of raw material price increases and outsourced graphitization processing fee increases has formed a dual pressure.
However, from existing financial reports and market data, the war mainly affects the anode industry through the supply and price transmission of petroleum-based raw materials; the tightening of graphitization processing capacity is more directly affected by previous overcapacity, contraction of capital expenditures, and rapid demand growth in 2026.
This also makes the competition in 2026 present two intertwined main lines: on the one hand, leading anode companies are making up for graphitization capacity; on the other hand, companies with petroleum, coking, chemical, and energy resources are beginning to look for opportunities to extend to anode manufacturing.
02 Coking Giants Enter with Green Power, Anode Integration Enters the Second Round of Competition
Binhai Energy provides another quite specific observation sample.
This listed company was mainly engaged in the printing business in the past. After the Risun system took over in 2022, the company began to transform to new energy anode materials and laid out an integrated project in Shangdu County, Ulanqab City, Inner Mongolia.
Compared with the path of traditional anode companies gradually extending upstream to graphitization from material R&D and customer certification, Risun has a background in coking and fine chemicals, and places more emphasis on the centralized allocation of manufacturing, energy, and capital resources.
In May 2026, Risun Group disclosed that Binhai Energy and its related parties have planned a 300,000-ton integrated anode material project in Shangdu County, supported by a 580MW source-grid-load-storage green power project.
The group expects that the relevant anode capacity will be further released in 2026, while building new energy and new materials into the third pillar industry alongside coke and chemicals.
Subsequently, the business expansion of Binhai Energy began to be reflected in operational data.
In the first half of 2026, the company's anode material and OEM business output reached 42,000 tons and sales volume reached 39,000 tons, a year-on-year increase of 64% and 68% respectively.
Among them, the sales volume of graphitization OEM business was 26,000 tons, a year-on-year increase of 22%; the sales volume of self-produced anode materials was 13,000 tons, a year-on-year increase of 599%.
During the same period, Binhai Energy's new energy business revenue reached CNY 416 million, a year-on-year increase of 78.49%, and the gross profit margin of anode materials and OEM business reached 8.73%, a year-on-year increase of 11.79 percentage points.
The company attributed the profit improvement to demand growth, the rise in graphitization processing fees and anode material prices, and the decrease in unit production costs after the release of new capacity.
This performance forms a contrast with Shangtai and ZKE. When anode finished product manufacturers need to increase outsourced processing procurement, Binhai Energy, which has graphitization OEM business, benefits from the rise in processing prices and relies on self-produced anode materials to increase business scale.
However, the profitability foundations of the two types of companies still have an obvious gap. In the first half of 2026, Binhai Energy's net profit attributable to the parent company was still a loss of CNY 28.2468 million, and the net cash flow from operating activities was -CNY 302 million.
In contrast, although Shangtai's profits declined, it still achieved a net profit attributable to the parent company of CNY 400 million. The improvement in Binhai Energy's business gross profit margin has been verified, but large-scale capacity expansion has not yet been transformed into stable overall company profitability.
Risun is investing more capital for this.
The registered capital of the new company in the October 9 announcement reached CNY 1 billion, jointly subscribed by Binhai Energy and Risun Group. Binhai Energy stated that the establishment of the new company is to apply for the construction of a new integrated anode material and supporting green power project, and joint investment with the controlling shareholder will help raise project capital.
This arrangement reflects a way for large industrial groups to support asset-heavy manufacturing businesses. The listed company is responsible for the operation of the new energy materials business, while the controlling shareholder directly participates in project capital investment, and both parties jointly bear the funding needs and investment risks of the new project.
And beyond the manufacturing end, Risun places more emphasis on the allocation of power resources.
On August 1 this year, the first phase of Binhai Energy's 150MW wind power project was officially connected to the grid for trial operation. Investor communication records in September showed that the company is promoting the construction of the remaining capacity of the 580MW green power project, and expects that after the 200,000-ton integrated anode project is fully put into operation, the green power coverage rate will exceed 50%.
The company explicitly stated that the supporting green power is expected to reduce the comprehensive electricity cost of anode materials.
For graphitization, this configuration has strong economic significance.
Graphitization requires a large amount of electricity to complete high-temperature heat treatment.
Using a scenario calculation of 10,000 kWh of electricity consumption per ton of product, for every CNY 0.1/kWh decrease in the comprehensive electricity price, theoretically CNY 1,000/ton of processing costs can be saved.
For a project with an annual processing capacity of 200,000 tons, the corresponding annual cost impact of the same electricity price difference can reach CNY 200 million.
This also explains why graphitization capacity has long been concentrated in low electricity price areas such as Inner Mongolia, and why this round of investment still chooses areas with abundant energy resources.
But the electricity market in 2026 is undergoing new changes.
In January this year, Inner Mongolia introduced a policy of direct green power connection for single electricity users; in May, the National Development and Reform Commission and the National Energy Administration further promoted multi-user direct green power connection.
Relevant policies allow industrial users to establish a more direct power supply relationship with new energy power sources, while requiring projects to bear transmission and distribution fees, system operation fees, and other expenses as required.
For large industrial enterprises, electricity competitiveness increasingly depends on long-term power purchase arrangements, the proportion of self-generation and self-use, load regulation capabilities, and comprehensive settlement costs.
This means that having wind and solar resources does not equal having low-cost electricity. Even if companies support the construction of wind and photovoltaic projects, they still need to solve the matching between the fluctuation of new energy power generation and graphitization production loads, as well as issues such as backup power, energy storage, and grid connection.
Moreover, in industrial agglomeration areas such as Inner Mongolia, graphitization is entering the same power resource allocation system as other industries.
The Ulanqab Zhongjin Data Low-Carbon Computing Power Base, which was put into operation in 2025, is supported by 200,000 kW of wind power, 100,000 kW of photovoltaics, and energy storage facilities, with a planned annual self-generated and self-used green power of 848 million kWh.
In 2026, Baotou Aluminum continues to improve the proportion of green power use through coordinated power supply from new energy, self-owned thermal power, and the public grid. Local disclosures show that its green power proportion has increased from less than 10% to over 30%.
Data centers, electrolytic aluminum, and graphitization have different electricity demands, but they are all seeking long-term, reliable, and price-competitive power supply. These projects jointly promote the integrated configuration of new energy power generation, grid connection, energy storage regulation, and industrial loads.
The above industries are in the same region or are experiencing direct competition for electricity. Therefore, the ability to obtain long-term power supply, supporting new energy indicators, and grid connection conditions is becoming an important factor that large industrial investments need to consider.
Risun's entry is precisely a reflection of this change in the anode industry.
And happening at the same time is the extension of traditional petroleum refining enterprises along the raw material supply chain to battery materials.
In March this year, Sinopec Yanshan Petrochemical disclosed that its delayed coking unit has achieved large-scale and stable production of high-end anode coke, with a cumulative production and sales of 24,000 tons as of March 16.
By optimizing parameters such as raw material ratio, heating furnace outlet temperature, circulation ratio, and fractionation system operation, the company improved the quality control level of anode coke in terms of sulfur content, ash content, and structural stability, and incorporated it into the "oil to special" business direction.
PetroChina Jinzhou Petrochemical is studying further extension to anode finished product manufacturing. On September 11, Jinzhou Petrochemical started the procurement of feasibility study report preparation for a 100,000 tons/year synthetic graphite anode material finished product project; on October 8, the relevant secondary procurement announcement was released again.
The project plans to use Jinzhou Petrochemical's self-produced precursors as raw materials, and simultaneously study anode material pilot lines and battery testing projects. It is currently still in the feasibility study stage.
These projects show that traditional energy companies are looking for new growth space outside the original industrial chain.
Petroleum refining enterprises can use existing coking units and raw material processing capabilities to produce high-end carbon materials, while coking and chemical groups have the opportunity to further invest in anode finished product manufacturing.
However, there are differences in raw material properties, quality requirements, and processing processes between coke, petroleum coke, and battery-grade anode precursors. Traditional energy companies still need to solve problems such as material R&D, mass production consistency, and customer certification.
This crossover is not limited to raw material resources.
On April 24, Wanhua Chemical announced that the continuous graphitization technology developed by its subsidiary Wanhua Battery Company was selected for the relevant technology list of Shanghai Climate Week 2026.
The company stated that the technology utilizes the experience of large chemical enterprises in continuous production, safety management, and thermal engineering equipment to shift traditional batch graphitization to continuous production, reducing the reaction time from 20 days to 20 hours.
Traditional graphitization uses batch high-temperature treatment, which requires processes such as furnace loading, heating, heat preservation, cooling, and discharging. Equipment turnover efficiency is constrained by the process cycle.
Continuous graphitization attempts to make materials continuously pass through the high-temperature treatment area, reduce the time occupied by auxiliary processes, and improve equipment utilization and thermal efficiency.
If the same material performance can be achieved under stable mass production conditions, the continuous process has the opportunity to reduce unit product energy consumption and production costs. However, the 20 days and 20 hours disclosed by Wanhua still need to unify the statistical boundaries, and the shortening of reaction time cannot be directly equated with a decrease in comprehensive manufacturing costs.
Traditional anode leaders have begun to lay out the same technology direction.
Shanshan Co., Ltd.'s 2026 semi-annual report disclosed that the company achieved an increase in graphitization capacity and a decrease in unit energy consumption by developing new box furnaces, increasing effective furnace volume, and optimizing the heating system.
Its self-developed continuous graphitization process products have passed the core project verification of leading customers and entered the trial mass production stage.
Keda Manufacturing listed trackless mobile graphitization 3.0 technology as one of its cost competitive advantages in the announcement of the 500,000-ton integrated project in September.
The company disclosed that the technology has obtained multiple patents, aiming to improve graphitization production efficiency and reduce energy consumption, while controlling production costs through local energy resources in Inner Mongolia and a shorter raw material procurement radius.
This makes the new round of graphitization competition present characteristics different from the previous round.
Early anode integration mainly relied on self-built graphitization plants to keep the costs originally paid to external processing companies within the company, and use scale and regional electricity price advantages to reduce production costs.
The new round of investment begins to simultaneously focus on upstream raw materials, supporting power, and changes in the graphitization process itself.
Risun attempts to combine its coking industry background, anode manufacturing, and green power projects; Wanhua leverages its continuous chemical and large-scale engineering manufacturing experience; existing anode companies such as Shanshan and Keda maintain cost competitiveness through furnace type upgrades, process transformation, and new integrated bases.
These paths have not yet formed a clear winner.
Traditional anode companies, after years of customer certification and mass production accumulation, still have high technical and market barriers in the fields of fast charging, long cycle life, and high-end anode materials.
The resource and cost advantages of cross-border companies need to be transformed into market share through battery customer verification, production line ramp-up, and actual delivery.
Greater uncertainty also comes from time.
The tightness of outsourced graphitization capacity in 2026 is stimulating anode companies to invest centrally, but most new projects still need time to form effective capacity.
Shanshan plans to start construction of a new 150,000-ton integrated base in March 2027, with an expected completion in July 2028; Keda's 500,000-ton project also needs to go through construction and gradual capacity achievement.
If graphitization processing fees fall again after the release of new capacity, the short-term shortage in 2026 may be transformed back into oversupply.
For companies that need to bear large fixed asset investments and long-term financing costs, the larger the capacity scale, the higher the operational risks brought by industry cycle changes.
Therefore, the second round of integrated competition ultimately still needs to be tested by costs and profitability.
From a longer industrial history perspective, China's anode industry has experienced a process from material R&D and professional division of labor to graphitization integration.
Now, with the expansion of energy storage demand, raw material price fluctuations, and changes in the energy system, anode manufacturing is further integrating with traditional petroleum, coking, power, and chemical industries.
This round of changes also means that the development of the NEV (New Energy Vehicle) and energy storage industries is opening up new profit space for traditional energy groups.
As electric vehicles gradually replace fuel vehicles, petroleum companies may enter the battery supply chain through high-end carbon materials; as the proportion of new energy power generation continues to increase, high-power-consuming graphitization plants become important industrial loads for long-term green power supply.
The industrial boundaries between traditional energy capital and new energy manufacturing enterprises are becoming more blurred.
Over the past decade, anode companies have improved the degree of manufacturing integration by mastering graphitization; in the coming years, raw materials, electricity, industrial engineering, and capital organization capabilities will further participate in determining the cost competitiveness of anode manufacturing.
For the anode industry, which has already formed a high degree of market concentration, this means that existing leaders need to continue to invest, and also provides an opportunity for latecomers with different industrial resources to re-compete for market share.
The graphitization tightness in 2026 may just be a cyclical supply and demand turning point, but the capital investment and industrial integration it promotes will continue to affect until after the next round of concentrated capacity release.
At that time, the results of competition among enterprises will more clearly reflect the effectiveness of this round of industrial resource reorganization.