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By Katha Kalia

Oct 14 (Reuters) - Titan Mining TI.TO said on Tuesday it will begin production of graphite concentrate at its Empire State Mines in New York, days after China expanded export limits on rare earth minerals, sending its shares soaring 26.8% in afternoon trade.

Titan plans to ramp up output to 40,000 tonnes per year, which it said could supply about half of the current U.S. natural graphite demand.

"China's decision to tighten graphite exports underscores the importance of a secure domestic supply," CEO Rita Adiani said, adding that the shift away from China would benefit Titan.

Graphite, along with lithium, cobalt, aluminum, and rare earth elements such as neodymium and dysprosium, is critical for electric vehicle batteries, wind turbines and power grids.

China dominates the global graphite market, refining more than 90% of the material.

Beijing, which already restricted rare earth exports, added five new minerals to its control list last week, bringing the total under export limits to 12.

The Trump administration has been stepping up efforts to reduce U.S. reliance on China for key materials, converting some federal grants into equity stakes to strengthen domestic supply chains for critical minerals and semiconductors.

Titan said its New York facility will produce natural flake graphite in micronized and high-purity forms, sourced from the company's Kilbourne deposit.

(Reporting by Katha Kalia in Bengaluru; Editing by Sahal Muhammed)

((Katha.Kalia@thomsonreuters.com;))