For batteries and secondary battery materials (finished products under HS 8507, including many materials, precursors, and minerals), policy, supply chain, and ESG variables have a greater impact on profitability than tariffs. Pressure to localize in North America (linked to subsidies), the EU's environmental and carbon regulations, and competition to secure key minerals are all evolving simultaneously.
Risk factors | 2025-26 Outlook | Influence (1~5) | Implications |
|---|---|---|---|
| North American localization (subsidy linkage) | Strengthening requirements and expanding detailed notification | 5 | Simultaneous review of North American assembly and materials lines |
| Core Mineral Supply Chain | Lithium and nickel volatility continues | 4 | Long-term offtake and multi-source procurement are essential |
| EU environmental and carbon regulations | Increasing demand for product and process data | 4 | LCA/Carbon Footprint Systematization |
| Exchange rate/logistics | Moderate volatility | 2 | Optimization of CIF/FOB terms and insurance |
| Geopolitics and Trade Policy | Selective restrictions on minerals and materials | 4 | Indirect sourcing and FTA cumulative utilization |
While finished batteries (HS 8507.x) frequently enjoy low or zero tariffs in major markets, practical bottlenecks remain in proving origin and key mineral sources, as well as subsidy eligibility . Some materials and precursors (e.g., 2825.20 lithium compounds, 2836.91 lithium carbonate, 3801.10 graphite) still have MFNs, significantly increasing the perceived impact of FTA application and accumulation.
division | FTA/ITA applicability (trend) | On-site difficulties | Management Points |
|---|---|---|---|
| 8507 lithium-ion battery | Most low-rate/tariff-free cases | Proof of origin of key minerals and components | Separate documentation system according to North American and EU requirements |
| 2825.20/2836.91 Lithium compounds | MFN deviations exist across countries | Precision classification and ingredient verification | Test report and COA are updated regularly. |
| 3801.10 Natural graphite/artificial graphite | Some tariffs and TBT apply | Distinction between appearance and use | HS Detailed Specification and Usage Description Consistency |
| 7502 nickel, 7403 copper, 7601 aluminum | Basic material MFN valid | Determination of origin and processing process | Parallel cumulative and RVC scenarios |
While the US and EU have relatively low tariff burdens on finished products (8507), restrictions on subsidy and procurement eligibility and the sourcing of key minerals pose substantial barriers. Emerging countries can differentiate themselves when utilizing FTAs due to the remaining MFN.
market | Representative HS (example) | MFN tariff (scope) | When FTA is applied (trend) | Non-tariff barriers (example) | Comments |
|---|---|---|---|---|---|
| USA | 8507, 2825, 2836 | Varies by item (low rate for finished products) | 0% high frequency | Subsidy/Procurement Eligibility/Key Minerals Regulations | Key North American Production and Material Procurement Requirements |
| EU | 8507, 3801, 7601 | 0~3% cases | 0% majority | Battery Regulations, REACH, and Eco-Design | Rising carbon, recycling, and LCA requirements |
| china | 8507, 2825 | 5~10% of items exist | Varies by concession/agreement | Certification and Industrial Policy | Simultaneous management of price, delivery, and certification |
| ASEAN (Vietnam, etc.) | 8507, Materials | ~5% reported | RCEP/Bilateral FTA reduction | Certification and administrative procedures | Valid for cumulative use within the region |
Note: Actual tariff rates and requirements may vary depending on HS subheadings, function, and ingredients. It is recommended to measure HTS/TARIC before customs clearance .
EU battery regulations, REACH, and Ecodesign require product-level LCA (raw materials to recycling) data. CBAM focuses on basic materials, but can be reflected in costs through indirect links such as electricity, aluminum, and graphite . Recycling and circulation (recycled content) rates are emerging as market entry requirements.
policy | applied area | Enforcement/Strengthening | Influence (1~5) | react |
|---|---|---|---|---|
| EU battery regulations | Battery life cycle | Step-by-step reinforcement | 5 | LCA/Carbon Footprint/Recycling Rate |
| REACH/CLP | Chemical management | Constant renewal | 4 | Registration, SDS, and Alternative Materials Roadmap |
| CBAM (linked) | Focus on basic materials → Indirect expansion | 2026~ | 3 | Power mix and aluminum linkage management |
Localization in North America : Localization of cell and module production and some cathode and anode materials, securing eligibility for subsidies and procurement.
EU Decentralization : Building anode and precursor lines + combining recycling (urban mining) to optimally address LCA.
ASEAN Processing : Primary Processing of Precursors and Materials + RCEP Accumulation to Optimize Costs and Delivery Times
Domestic R&D Hub : Maintaining pilot projects for next-generation electrolytes, silicon anodes, and high-nickel cathodes.
Forecast_3M is calculated by combining public statistics, news and policy sentiment (α), global consensus (β), and sector sentiment (λ) . The battery sector exhibits high ΔSignal sensitivity to policy news , leading to significant short-term volatility . However, both exports and investment show a gradual improvement during periods of stable material prices .
variable | Δ(%) or exponent | analysis |
|---|---|---|
| ΔExport_now | +2.8 | A simultaneous increase in finished products and materials for North America and the EU |
| ΔImport_now | +3.6 | Expanding imports of precursors and minerals (line expansion) |
| ΔPrice_now | +0.5 | Expanding the proportion of high-nickel and silicon cathodes |
| ΔSignal_now | +0.032 | Policy, demand, and exchange rate composite signals are "positive." |
| ΔFTAEffect | +0.35 | FTA/Cumulative Effect + Subsidy Eligibility Response |
| Forecast_3M | +0.56 | Suggesting moderate growth within three months |
Formula (summary): Forecast_3M = 0.5·ΔSignal + 0.3·ΔFTAEffect + 0.2·ΔPrice
field | Suggestion | Executor | Expected effect |
|---|---|---|---|
| Core Minerals Strategy | Strengthening Korea-Australia-Chile Mineral FTA and Supply Chain Cooperation | Trade authorities and public corporations | Price and supply stability |
| Origin/Accumulation | Enhanced PSR/RVC Guidelines to Meet North American and EU Requirements | Korea Customs Service and Ministry of Trade, Industry and Energy | Simultaneous optimization of subsidies and tariffs |
| ESG·LCA | Battery LCA and Recycling Data Standardization | Companies and Associations | Meet delivery requirements and receive premium |
| digital trade | Standardizing Cross-Border Transfer of Design, IP, and Data | Ministry of Trade, Industry and Energy·KOTRA | Promoting intangible value exports |
| Finance and Insurance | Mineral Price Hedging and ESG Trade Finance Promotion | Ministry of Strategy and Finance and Policy Finance | Absorbing volatility and promoting investment |
Subsidies, procurement eligibility, key minerals, and ESG data are more important factors in determining competitive advantage than tariff reductions .
A dual supply chain is reasonable , based on FTA accumulation and regional requirement divergence (North America and EU) .
Forecast_3M: +0.56 → Short-term improvement possible, but sensitive to policy announcements and mineral price fluctuations .
