A top-three Chinese anode producer pulls roughly RMB 10.3 billion of planned capacity as oversupply reshapes the sector.
On the evening of 12 June 2026, Zhongke Electric (SZ: 300035), one of China’s most active lithium battery anode producers, announced that its board had approved the termination of three previously planned investment projects with a combined planned investment of roughly RMB 10.3 billion (about US$1.5 billion).
The company said it would instead concentrate its resources on its 300,000 tpa Luzhou base in Sichuan and its 200,000 tpa integrated base in Oman.
The decision points to the strain that anode oversupply is placing on even top-tier Chinese producers. Zhongke is withdrawing from RMB 10.3 billion of planned domestic and Moroccan capacity announced over the past three years, citing changed implementation conditions in a market characterised by significant oversupply.
The pattern of the cuts is notable. Two domestic projects and the Moroccan base have been dropped, while the Oman project survives, indicating capital being redirected away from crowded home-market capacity and a stalled European-facing plant toward one domestic flagship and one overseas base positioned to serve customers from outside China.
For graphite and anode developers outside China, the signal is mixed: Chinese capacity expansion is slowing on cost grounds, but the capacity that does proceed is increasingly oriented toward export markets.
The Three Terminated Projects
The board’s resolution covers two projects planned in 2022 and held in abeyance since, plus a 2024-vintage overseas base that never broke ground. All three had undertaken only partial preparatory work and had not entered substantive construction or operation.
The Ganmei project began in May 2022, when Zhongke signed an investment contract with the management committee of the Ganmei Industrial Park in Sichuan to build a 100,000 tpa integrated anode plant, with fixed-asset investment of about RMB 2.5 billion over a 36-month build. By September 2022 the scope had been upsized to 130,000 tpa, lifting fixed-asset investment to around RMB 2.8 billion (about US$414 million). On the original timetable it should already have been complete; in practice only early preparatory work was done before it was paused.
The Lanzhou New Area project followed in October 2022, again a 100,000 tpa integrated anode plant, with fixed-asset investment of about RMB 2.5 billion (about US$370 million) and a build cycle of up to 36 months excluding the three-month winter shutdown each year. It was structured as the investment vehicle of a planned joint venture between Zhongke’s wholly owned subsidiary Hunan Zhongke Shinzoom and Chongqing FinDreams Battery (BYD’s battery arm). It too stalled at the preparatory stage.
The Morocco project dates to April 2024, when Zhongke’s board approved an indirect overseas structure (via Hong Kong) to build a 100,000 tpa integrated anode base in Morocco, with total planned investment of up to RMB 5 billion (about US$740 million), split into two 50,000 tpa phases of around 24 months each. At the time the company billed it as significant for cementing its industry position and building a globally leading anode brand. It never advanced beyond preliminary work.
Zhongke stressed that because all three projects were only at the preparatory stage, with limited capital committed and related construction-in-progress already fully impaired in prior years, the terminations will not disrupt normal operations or materially harm its current financial position.
From Land-Grab to Discipline
The reversal is striking given how aggressively Zhongke expanded as recently as last year. The company said the implementation conditions for the three projects had changed and that, to lower investment risk and optimise resource allocation, it had decided after review to terminate them and instead push forward with Luzhou and Oman.
That leaves two clear survivors:
The Luzhou commitment followed a deepened strategic cooperation agreement with Chengdu Industrial Investment Group in October 2025, which included plans to site Zhongke’s national anode headquarters in Chengdu.
The Bigger Picture
Zhongke’s anode business accounts for the bulk of the company: lithium battery materials generated revenue of RMB 7.983 billion last year, or 94.28% of the total. According to EVTank, Zhongke ranked third in China for anode shipments in 2025, behind BTR and Shanshan and alongside peers Putailai and Shangtai. Its customer book spans CATL, BYD, CALB, LG Energy Solution and Samsung SDI.
Group revenue reached RMB 8.468 billion in 2025, up 51.72% year-on-year, with net profit attributable to shareholders of RMB 469 million, up 55.09%. The first quarter of 2026 told a more cautionary story: revenue of RMB 2.272 billion was up 42.17%, but attributable net profit fell 51.93% to RMB 64.65 million, an indication of how compressed anode margins have become even for the volume leaders.
Against that backdrop, the decision to pull RMB 10.3 billion of earlier-stage capacity and concentrate on two projects with clearer demand visibility can be read less as a retreat than as a recalibration toward financial discipline.
All CNY figures converted to USD at an approximate rate of 1 USD = 6.76 CNY as of 13 June 2026.
Primary source: Shimo Shixun (石墨时讯), “负极龙头大动作！三大项目终止”, via WeChat, June 2026, based on Zhongke Electric (300035) board announcement of 12 June 2026.
Supporting references:
• Yicai Global, “China’s Zhongke to Build Lithium Battery Material Plant in Oman for USD1.1 Billion”, 5 June 2025.
• Kallanish / SEAISI, “Zhongke Electric to build $1.1 billion anode plant in Oman”, June 2025.
• Shanghai Metal Market (SMM), June 2025 (Morocco original scope; Q1 2025 balance-sheet context).
Disclosure: This is GraphiteHub analytical commentary, drawing on a Chinese-language report published on WeChat together with Zhongke Electric’s own exchange filing, supplemented by the referenced third-party sources. GraphiteHub does not guarantee the accuracy of translated or third-party material and accepts no responsibility for errors or omissions. Where GraphiteHub has a commercial relationship relevant to the subject of an article, this will be clearly stated; absent any such statement, no commercial relationship exists, and GraphiteHub retains full editorial independence. This content is for informational purposes only and does not constitute investment advice.