Can the Dependence on China for Batteries Be Broken? Panasonic's Involvement in a Canadian Graphite Project

Can the "Dependence on China" for Batteries Be Broken? Panasonic's Involvement in Canada's Graphite Project

The competitiveness of electric vehicles is determined not only by their range and charging speed but also by the ability to produce the necessary amount of batteries when needed. The supply chain of less conspicuous materials can influence the future of manufacturers.

One such material is graphite.

Graphite, widely used as an anode material in lithium-ion batteries, is a crucial material supporting the battery industry. However, the process of refining it to a quality suitable for batteries is heavily concentrated in China.

Nouveau Monde Graphite (NMG) in Canada is attempting to change this structure. The company is working on establishing a supply chain that connects mines to battery materials in Quebec.

For Japan, this is not a distant resource development. Panasonic Energy is an important partner in this initiative.

Not "Batteries Without Graphite," But Changing the Graphite Procurement Route

There are key points to note in this news.

The goal is not to create a new type of battery that eliminates the need for graphite. It is to add an alternative to the graphite supply and processing routes concentrated in China.

The U.S. Energy Information Administration (EIA) explains that China handles over 90% of the world's graphite processing. The original article also cites a figure of about 95% for spherical graphite processing, but the ratio varies depending on the processing target and scope of aggregation. "Graphite processing" and "spherical graphite processing" should not be treated as the same statistic.

Nevertheless, the problem of concentration in the processing stage is common.

Even if ores can be mined outside of China, if the subsequent processing relies on China, the diversification of the supply chain remains incomplete. It is necessary not only to increase the number of resource-producing regions but also to develop the capability to manufacture materials that can be delivered to battery manufacturers.

The Concept of "From Mine to Battery Materials" Progressing in Canada

NMG's plan is to connect the Matawinie mine with the Bécancour battery materials plant.

In May 2026, the Canadian government announced the start of construction of the Matawinie mine. Once completed, it plans to supply up to 106,000 tons of graphite annually, positioning it as the largest graphite mine in the G7.

However, considering this amount as the "production volume of anode materials for batteries" would be misleading. Graphite concentrate obtained from the mine and anode materials incorporated into batteries are different products.

In the subsequent process envisioned by NMG, graphite particles are refined, impurities are removed, and the surface is coated. Through such processing, the material is finished to be suitable for battery use.

There is a significant barrier between being able to mine and being able to continuously supply battery manufacturers. The core of NMG's challenge is to overcome that barrier domestically in Canada.

Why Panasonic's Involvement is Important for Japan

In 2024, Panasonic Energy and NMG announced a long-term supply agreement for anode active materials. The contract at that time targeted an annual supply of 18,000 tons for an initial seven years, with Panasonic also announcing an initial investment of 25 million USD.

The contract includes conditions such as the start of commercial operations and certification of the final product. The agreement did not mean that mass supply had been completed at the time of signing.

Furthermore, in NMG's 2026 announcement, the Bécancour plant is described as a plan with an annual production scale of 13,000 tons. The contract quantity in 2024 and the scale of the current plant plan should be read separately.

For Japanese companies, the significance of this collaboration goes beyond simply finding a new supplier. It is an effort to nurture the supply source itself by evaluating materials according to battery specifications and verifying quality during mass production.

If switching suppliers results in unstable performance or deteriorating yield, competitiveness cannot be maintained even if the supply chain is diversified. This is why resource companies and battery manufacturers collaborate from an early stage.

The Start of Mine Construction and Completion of Processing Plants Are Separate Milestones

When evaluating this plan, the most important aspect to consider is the stage of business progress.

In its August 2026 announcement, NMG reported the final investment decision and start of construction for the Matawinie mine. On the other hand, it explained that preparations are underway for the final investment decision for the Bécancour plant.

Furthermore, in the October 14 announcement, the final investment decision for the plant was still targeted for the coming months.

In other words, just because the mine has started operations does not mean that a large-scale battery material supply chain, independent of China, has already been completed.

Advancing mine construction, deciding on investments for processing plants, setting up equipment, and consistently shipping materials that meet customer requirements are all separate challenges.

It is important to look beyond the big words like "breaking dependence on China" to see which stages of the supply chain have been realized.

Even with Resources, Supply Cannot Be Increased Without Equipment and Technology

The International Energy Agency (IEA) lists graphite as one of the materials with high supply vulnerability in its 2026 critical minerals outlook.

This explanation is not limited to the origin of the ore. It also states that there are limited companies outside of China that can supply the main equipment needed for processing battery-grade graphite.

This indicates that simply opening a mine does not naturally increase the production of battery materials.

Only by procuring equipment, accumulating operational technology, reducing defects, and meeting the demands of each customer can it function as an alternative supply source.

For Japan's battery industry, cooperation that includes not only resource rights but also processing equipment, material evaluation, and manufacturing know-how is crucial. It is a question of what can be created with overseas partners, not just what to buy from abroad.

Expectations for Growth and Concerns About Shareholder Burden on Social Media

On social media, posts can be found viewing NMG as a long-term theme in the battery supply chain.

In March 2026, a post in a Reddit investment-related community considered the company as a candidate for long-term investment in the EV supply chain. This perspective finds growth potential in the industrial structural change of diversifying resource procurement.

On the other hand, in an NMG-related community in May, there were posts expressing dissatisfaction with the stock issuance price in response to posts dealing with public investment. The issue is that fundraising to advance business leads to concerns about dilution for existing shareholders.

This reflects the difference between evaluation as industrial policy and evaluation as an investment in individual companies.

Even if efforts to diversify the supply chain are important, it does not guarantee a rise in the company's stock price or profitability. How to fund large-scale capital investments and when to connect them to sales need to be considered separately.

These are examples of related posts about NMG and are not direct reactions to the original article. They represent the opinions of a limited investment community and do not represent the entire social media or general public opinion.

Reading Separately the Expectations in Advertorials and Actual Business Progress

The article published in FinanzNachrichten, which served as the starting point for this discussion, is clearly marked as "advertisement."

The article also introduces future profits from mining and processing businesses and the utilization of by-products, but these cannot be taken as current revenue achievements. This is because they depend on assumptions about future production volumes, prices, and operating rates.

There is no need to dismiss the entire plan just because it is introduced as an advertisement. There are verifiable developments, such as the government's announcement of the start of construction and the contract with Panasonic.

However, readers need to distinguish between "what has been realized," "what has been agreed upon in contracts," and "future goals." In particular, one should not mistake the progress in mine financing for the completion of the entire plan, including processing plants.

What Japan Needs is to Increase the Number of Supply Chains It Can Choose From

This plan raises the question for Japan of how many procurement sources for battery materials can be made available.

Increasing supply sources does not necessarily mean a short-term reduction in material prices. Building new facilities incurs costs, and startup also requires time.

Nevertheless, if supply is concentrated in one region or process, disruptions in that location can affect the production of finished products. The value of alternative supply sources cannot be measured solely by peacetime purchase prices.

NMG's efforts are a concrete attempt to increase those options. To judge success or failure, it is necessary to witness not only the completion of the mine but also the investment decision for the processing plant, quality certification, and stable shipment.

Competition in the battery industry is not only about visible finished products. It is about who can consistently produce the black materials inside, where, and how. Canada's plan reflects this competition, which also involves Japanese battery manufacturers.

Sources and References

1. FinanzNachrichten/AXINO Capital:
   An article introducing NMG's mining and processing plans and the company's future outlook. Marked as "advertisement."
   https://www.finanznachrichten.de/nachrichten-2026-10/69932977-batterien-ohne-china-graphit-diese-loesung-koennte-den-westen-unabhaengiger-machen-674.htm

2. U.S. Energy Information Administration (EIA): China's Position in the Battery Mineral Supply Chain
   Reference on the concentration of graphite processing in China.
   https://www.eia.gov/todayinenergy/detail.php?id=65305U.S. Energy Information Administration (EIA)

3. Prime Minister of Canada: Start of Construction of the Matawinie Mine
   Announcement on May 19, 2026, regarding planned production volume and the scale within the G7.
   https://www.pm.gc.ca/en/news/news-releases/2026/05/19/prime-minister-carney-breaks-ground-nouveau-monde-graphites-matawiniePrime Minister of Canada

4. NMG: Supply Agreement and Investment Announcement with Panasonic Energy
   Confirmation of contract quantity, duration, initial investment amount, commercial operation, and quality certification conditions as of 2024.
   https://nmg.com/binding-offtake-panasonic/nmg.com

5. NMG: Business Progress in Q2 2026
   Confirmation that the start of mine construction and the Bécancour plant plan with an annual production of 13,000 tons are at different stages of progress.
   https://nmg.com/q2-2026/nmg.com

6. NMG: Official News List
   Reference to the situation towards the final investment decision for the Bécancour plant as stated in the October 14, 2026 announcement.
   https://nmg.com/news/nmg.com

7. IEA: Global Critical Minerals Outlook 2026
   Reference to the supply risk of graphite and the limited number of companies outside China that can supply processing equipment.
   https://www.iea.org/reports/global-critical-minerals-outlook-2026/executive-summaryIEA

8. Reddit: Posts Considering NMG as a Long-term Investment
   Examples of posts expecting the company as part of the EV supply chain. Summary of publicly confirmed parts through search.
   https://www.reddit.com/r/StocksAndTrading/comments/1rsxmtu/analyzing_the_north_american_graphite_play_nmg/$NMG

9. Reddit: Reactions to Posts on Public Investment and Stock Issuance
   Examples of opinions expressing concerns about stock issuance prices and impacts on existing shareholders. Summary of publicly confirmed parts through search.
   https://www.reddit.com/r/NMGRFstock/comments/1thsjjc/the_quebec_government_has_just_announced_an_85/