Tungsten concentrate prices have surpassed the RMB400,000 threshold, APT prices have broken through the RMB 600,000 mark, and tungsten powder prices are nearing the RMB 1,000 level. As the year draws to a close, market tensions are running high. On one hand, news of production halts and maintenance at raw material sources, coupled with reluctance to sell, has intensified concerns over supply tightening. This has triggered limited restocking demand within the market, driving tungsten prices higher. However, the sustained price surge has significantly strained market liquidity. Additionally, year-end pressures from receivables collection and financial settlements have notably dampened market purchasing capacity and willingness. Transactions are primarily concentrated in long-term contracts and sporadic stockpiling, with overall trading activity remaining cautious. Industry insiders note that this year's tungsten price surge has far exceeded the support of physical consumption, being driven more by speculative demand. As year-end capital speculation intensifies, market uncertainty is amplified. Participants are advised to operate rationally and cautiously to guard against speculative volatility.
Data shows that the latest price for mainstream domestic 65% black tungsten concentrate has reached RMB 416,600 per ton, marking an increase of over 190% since the beginning of the year.
1) In the short term, tungsten prices are expected to remain firm and continue setting new highs. On the supply side, domestic production faces increasing contraction pressure due to declining ore grades and stricter regulatory requirements. Overseas, while Kazakhstan's Bakutah tungsten mine is gradually coming online, this incremental supply is primarily absorbed by Chinese imports to alleviate domestic pressure, unlikely to significantly impact global supply. Additionally, the commissioning schedules for other major overseas expansion projects remain uncertain. Compounded by ongoing geopolitical conflicts and rising overseas inflation pressures, global tungsten supply expansion now requires higher incentive prices.
2) Long-term, tungsten price fundamentals are driven by supply-demand dynamics. Global tungsten supply-demand is expected to remain tight, driving sustained upward pressure on the price center. Based on tungsten metal content, global primary tungsten production is projected to increase from 79,500 metric tons to 89,900 metric tons between 2023 and 2028, while global primary tungsten demand is expected to rise from 96,200 metric tons to 110,000 metric tons.
Supply contraction coupled with long-term contract price hikes has pushed tungsten prices to record highs. On the supply side, mining quotas for tungsten concentrate have been reduced, mines have generally slowed production pace, and industry circulation continues to tighten. On the demand side, domestic demand remains largely stable, driven primarily by essential procurement, with robust demand for PCB cutting tools. Recently, major domestic tungsten producers raised long-term contract prices for the first half of December, boosting market bullish sentiment.
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