【Thematic Review】Exploration and Analysis of Export Controls on Carbon Fiber

On December 31, 2024, China's Ministry of Commerce and the General Administration of Customs jointly issued the 2025 Adjustment Announcement on the "Catalogue of Dual-Use Items and Technologies Subject to Import and Export License Administration" in accordance with the "Export Control Law of the People's Republic of China," the "Regulations on the Export Control of Dual-Use Items," and relevant laws and regulations. Among them, the export control policy on carbon fiber has become the focus of industry attention. The new policy, officially implemented on January 1, 2025, marks a new stage in China's management of high-end material exports. This policy adjustment primarily targets high-performance carbon fiber and its composites, covering products at the T800 level and above. Export enterprises are required to apply for export licenses from the Ministry of Commerce and provide proof of the end-user and end-use.

1. Background and Importance of Carbon Fiber Control

As a strategic material characterized by high strength, lightweight, and high-temperature resistance, carbon fiber is widely used in aerospace, defense and military industries (e.g., missiles and fighter jets), and high-end industrial sectors (e.g., wind power generation and automotive lightweighting). Consequently, it is regarded as a sensitive technological material by many countries. Within the international control framework, the Wassenaar Arrangement (WA), involving 42 member countries, restricts the export of high-modulus (e.g., above T800) carbon fiber to non-member countries. The U.S. Export Administration Regulations (EAR) include specific carbon fibers in the Commerce Control List (CCL), requiring permission from the Department of Commerce. China began implementing the "Export Control Law" in 2020, incorporating high-performance carbon fiber into the control list, particularly models with a tensile strength of ≥4,500 MPa.

Table 1: Control Measures of Major Countries Worldwide

2. Functions and Significance of Export Controls

Export controls on carbon fiber involve restricting or regulating the export of carbon fiber and its related technologies and equipment based on national security, technological protection, or international obligations. Control measures cover the production, processing, and application of carbon fiber, aiming to ensure that critical technologies do not fall into unauthorized hands. Countries or regions clarify the scope, standards, and approval processes of export controls through legislation. Export enterprises must submit applications and obtain export licenses after review. During the review process, factors such as the political stability of the export destination, relations with the home country, and the recipient's commitment to use are considered to ensure that export activities do not pose a threat to national security or violate international obligations. Export control policies are adjusted in response to changes in the international situation and technological advancements, with control lists updated to adapt to the dynamics of the international security environment and technological competition. For the carbon fiber industry, this signifies China's strategic confidence in the global carbon fiber market, ensuring a leading position amidst fierce international competition, presenting both challenges and opportunities. On one hand, enterprises must strictly comply with relevant regulations and strengthen internal management to ensure compliant operations; on the other hand, amidst a volatile market situation, this incentivizes enterprises to increase R&D investment and enhance independent innovation capabilities to gain a favorable position in fierce market competition.

3. Interpretation of China's Carbon Fiber Control Policies

The "Catalogue of Dual-Use Items Subject to Export Control of the People's Republic of China" explicitly includes carbon fiber and its products with high modulus (≥241 GPa) and high strength (≥3,000 MPa) within the scope of control, closely monitoring key parameters such as tensile strength, elastic modulus, and fiber morphology, and implementing a strict approval system for carbon fiber exports involving military, nuclear energy, missile technology, and other fields. The "Catalogue of Dual-Use Items and Technologies Subject to Import and Export License Administration" details the types of export licenses and general licenses. Export enterprises are required to submit applications to the Ministry of Commerce or local commerce authorities and provide relevant materials such as technical descriptions and end-user commitments, with an approval period of approximately 20-30 working days.

Table 2: Comparative Analysis of Single Licenses and General Licenses

When customs has doubts about declared carbon fiber goods, it issues a "Customs Inquiry Notice on Export Control of Dual-Use Items." Enterprises must respond within 7 working days and submit the following materials: a customs declaration form stamped with an official seal, an export contract containing technical specifications, a detailed description of performance indicators, uses, and non-controlled reasons, a fiber mechanical performance test report issued by a third-party institution, and other supplementary materials required by customs (e.g., Chinese translations for foreign language materials). Customs will review the submitted materials. If the materials are complete and comply with regulations, customs will lift the query on the goods; if the materials do not meet requirements or customs still has doubts, customs may further request additional information from the enterprise or conduct on-site inspections. Throughout the process, enterprises should actively cooperate with customs to ensure the truthfulness and accuracy of information. In addition, enterprises must note that once carbon fiber goods are identified as dual-use items and involved in illegal exports, they will face severe legal sanctions and economic penalties. Therefore, enterprises should strictly comply with relevant laws and regulations to ensure the legality and safety of carbon fiber exports.

Table 3: Customs Determination and Disposal

The mastery and application of carbon fiber technology have become a symbol of the delicate balance between cutting-edge technology and national security. Polyacrylonitrile-based (PAN) carbon fiber, such as T300 grade, is relatively openly circulated due to its wide application in civilian fields; however, the situation is entirely different when it comes to high-performance fibers at the T700 to T1100 military grades, which are subject to strict export controls to prevent them from falling into the hands of potential adversaries. Pitch-based carbon fiber plays a key role in the aerospace field, used in manufacturing components that withstand extreme high temperatures, and is therefore subject to even stricter regulation. From precursor production technology to high-temperature carbonization furnaces, and then to winding molding equipment, every aspect of technology and equipment is crucial and equally closely monitored to ensure that technological advantages are not weakened. In short, carbon fiber is not only the pinnacle of material science but also an indispensable piece in the international strategic landscape.

4. Impacts and Response Strategies of Carbon Fiber Control

1) Impacts on China's Domestic Market

Before the implementation of export controls, the export proportion of high-performance carbon fiber (T800 grade and above) increased from 5% in 2020 to 12% in 2025. The implementation of export controls has significantly increased the difficulty of exporting high-performance products, forcing domestic high-end applications such as aerospace to accelerate localization (currently less than 30%), which is beneficial in the long run for leading technology enterprises. For example, enterprises such as Zhongfu Shenying Carbon Fiber and Guangwei Composites are stepping up R&D efforts to develop technologies comparable to T1200-grade carbon fiber. In addition, the National Integrated Circuit Industry Investment Fund has invested over 20 billion yuan in carbon fiber projects, aiming to build a closed-loop full industry chain from precursor to composites, thereby significantly enhancing China's independent innovation capabilities in the carbon fiber field. The export control of specific equipment, software, and technologies related to carbon fiber fibers in certain fields such as aerospace and shipbuilding helps prevent the outflow of key technologies and core materials, safeguarding national security and interests. Anderson Composites (Weihai) Co., Ltd. has achieved a transformation from low-end to high-end by conducting industry-university-research cooperation with Shandong University and Harbin Institute of Technology, Weihai Campus, forming industry chain collaboration with local carbon fiber and carbon fiber prepreg suppliers, controlling unnecessary costs, increasing R&D and quality investment, and continuously launching new products such as carbon fiber tail fins for Ford Mustang and Raptor models, which have been recognized by the European and American aftermarket, achieving business growth and upgrading in the face of market changes and policy adjustments through technological innovation and market expansion.

2) Impacts on Key Industries

The impact of carbon fiber control on key industries is significant and far-reaching, revealing the vulnerability and adjustment pressure of the global supply chain. On the positive side, it has accelerated the pace of国产替代 in China, with China's T800-grade carbon fiber capacity surging in 2024 and promoting downstream application R&D, such as a significant increase in the amount of composites used in the C919 large aircraft. However, this transformation has also brought severe challenges, with small and medium-sized enterprises struggling under the pressure of technological upgrades and the industry concentration continuously increasing. Among global key industries, aerospace giants Boeing and Airbus have been forced to adjust their supply chains, turning to higher-cost suppliers such as Toray in Japan or Hyosung in Korea, resulting in a 5%-10% increase in costs. The new energy and automotive industries have also been affected, with potential delays in wind turbine blade production and extended validation cycles for Tesla's 4680 battery casings. The sports equipment market has not been spared, with price fluctuations in high-end bicycles, rackets, and other consumer goods, and some brands turning to suppliers in Turkey or Mexico to survive. The ripple effects of carbon fiber control undoubtedly pose a severe test to the stability of the global industry chain. The changes and uncertainties in export control policies expose enterprises to numerous challenges, such as policy misunderstandings and market misjudgments, which may lead to violations by enterprises and result in legal risks and economic losses. For example, two subsidiaries of Triumph Technology are under review for suspected smuggling of goods prohibited from import and export by the state.

3) Impacts on the Global Supply Chain

With the readjustment of the international division of labor, the United States, Japan, and European countries are accelerating the expansion of their domestic production capacities. For example, Toray's factory capacity in the United States has increased by 50%, and Japanese companies such as Teijin and Mitsubishi Rayon are also actively expanding their carbon fiber production capacities in the United States. These measures have significantly enhanced the competitiveness of these enterprises in the international market and further intensified the competitive landscape of the global carbon fiber supply chain. However, the current policy only targets high-end carbon fiber, while low-end carbon fiber T300 (large tow) is not subject to control, leading to a 50% expansion in production scale for some manufacturers and an increase in costs. At the same time, long-term structural changes are quietly occurring, with some enterprises beginning to explore basalt fiber or high-performance glass fiber as potential technological alternatives. In addition, Western countries strictly restrict the export of carbonization equipment to China, prompting China to independently develop relevant technologies, such as Jinggong Technology's breakthrough in thousand-ton-scale production lines, leading to a differentiation in the global equipment market competition landscape.

4) Enterprise Response Strategies

Enterprise response strategies should include strict compliance management and the development of effective alternative solutions. In terms of compliance management, enterprises need to establish an Export Control Classification Number (ECCN) system to identify controlled models and apply for necessary export licenses in accordance with relevant national regulations. For example, in China, enterprises must submit end-user statements to the Ministry of Commerce. In addition, enterprises should consider developing non-restricted models, such as by reducing the modulus below the controlled threshold to circumvent export restrictions. Faced with the challenges of export controls, some enterprises have adopted flexible and diverse response strategies: on the one hand, they use technological circumvention methods, such as adjusting carbon fiber processes to reduce the modulus and ensure that products comply with export standards; on the other hand, digital compliance has become an important tool for enterprises to cope with control risks, with the application of AI technologies such as HS code automatic matching systems significantly improving enterprises' compliance efficiency.

These short-term response measures not only help enterprises cope with current difficulties but also, in the long run, strengthen China's national security, reduce the dependence of the military industry on imported materials, such as a significant increase in the localization rate of missile casings. In addition, China has also countered Western technological blockades through control measures and actively participated in multilateral negotiations, such as promoting the revision of RCEP carbon fiber trade clauses, enhancing its voice in international rule-making, and making positive contributions to safeguarding national interests and promoting fair and free global trade.

5) Response Strategies of Industry Associations

Industry associations should regularly conduct industry research to understand the actual situations and needs of enterprises under export control policies and timely feedback industry dynamics and enterprise demands to government departments. By organizing seminars and symposiums, they can promote exchanges and cooperation among enterprises to jointly cope with the challenges brought by export controls. Research and formulate top-level development suggestions for the development of carbon fiber composites during the "15th Five-Year Plan" period, determining development goals, clarifying main tasks, strengthening industrial layout, and designing development paths to avoid homogeneous industrial development and cultivate new quality productive forces. For example, through the guidance of industry associations, enterprises can be encouraged to increase investment in R&D and technological innovation to improve the competitiveness of the entire industry.

Guide policies to increase investment in R&D of high-performance carbon fiber materials and promote technological innovation. Establish bridges between universities, research institutions, and enterprises to conduct research on relevant common technologies, improve China's manufacturing technology level in high-performance carbon fiber composites, and reduce the proportion of manufacturing costs in product costs. For example, through industry-university-research cooperation, solve key technological problems in the R&D of high-performance carbon fiber composites, improve the performance and quality of domestic materials; solve the automated manufacturing level of high-performance carbon fiber composites, expand the application scenarios of equipment such as automatic fiber placement and tape laying, and promote the reduction of equipment and manufacturing costs.

The HS code is a global commodity classification convention implemented in 1988, currently covering more than 200 countries and regions worldwide and handling international trade commodities worth approximately $18 trillion annually. As the "international trade passport" for commodities, it has three attributes: commodity identity recognition, base calculation for tariff collection, and linkage with trade policies. Composite materials have a wide variety of product types, and different HS codes have significant differences in tariff rates and policies. If errors occur, they may be regarded as malicious fraud to obtain tariff preferences. Associations should increase research on HS codes in composite materials to help enterprises comply with regulations and obtain favorable tariff rates. At the same time, lower the standards for applying for general licenses for low-sensitivity products, while strictly adhering to the single license defense for high-sensitivity products. Provide support to member enterprises in terms of technical file management in document storage.

Dear colleagues in the composite materials industry, we must always stay highly attentive to the latest revisions of the "Catalogue of Dual-Use Items and Technologies Subject to Import and Export License Administration," especially the restriction policies on key materials such as T700 grade in 2024, to ensure that our business operations comply with regulations and promptly adjust our business strategies. At the same time, we should actively learn from the successful cases of peer enterprises, continuously learn advanced experiences, and continuously optimize our declaration strategies to enhance our competitiveness. Only in this way can we remain invincible in the fierce market competition and jointly promote the prosperity and development of China's composite materials industry. Let us contribute to the sustainable and healthy development of the industry with practical actions!

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