SunSirs: Tungsten Prices Poised to Stabilize and Rebound Amid Approaching Peak Season and Supply Contraction

After experiencing "roller-coaster" volatility in the first half of the year, tungsten prices entered a phase of consolidation—trading within a narrow range—during the third quarter. Data from "China Tungsten Online" shows that recent quotes for black tungsten concentrate (65% grade) have held steady at around RMB 415,000 per standard tonne, while the price of ammonium paratungstate (APT) has fluctuated narrowly near RMB 610,000 per tonne. Although these levels represent a significant retreat from the year's highs, they remain historically elevated.

"There is a general consensus within the industry that prices should stabilize at this point," a representative from a listed tungsten company told the Shanghai Securities News. Research reports from multiple institutions indicate that tungsten supply continues to face multiple, tight constraints. With emerging demand—such as that for AI PCBs and tungsten hexafluoride—continuing to rise, coupled with the approach of the traditional peak consumption season in September and October, tungsten prices are expected to stabilize and rebound.

Tungsten Prices Consolidate Amid Intensifying Upstream-Downstream Tug-of-War

Since August, the domestic tungsten market has maintained the stalemate and sideways trading pattern seen since July. Mainstream quotes for black tungsten concentrate (65%) have remained stable at the 410,000 RMB /standard tonne level; APT transaction prices have stalled near the 610,000 RMB/tonne mark; and trading prices for tungsten powder and tungsten carbide powder have hovered around 975 RMB /kg and 925 RMB/kg, respectively.

In terms of price trends, tungsten prices underwent extreme volatility in the first half of the year. Taking black tungsten concentrate (65%) as an example, the quote on August 14 was 415,000 RMB /standard tonne. While this represents a drop of over 60% from the historical peak of over 1 million RMB /standard tonne reached in March, it still reflects a gain of more than 90% compared to the average price level seen earlier in the year.

"Upstream quotes remain relatively firm, but downstream buyers are still purchasing strictly according to demand; there are no obvious changes for the moment," the aforementioned tungsten company representative stated. A leading listed tungsten company revealed that orders remain stable, and with tungsten prices recently stuck in a sideways pattern, there are no clear signs of an imminent rise. CTIA (China Tungsten Online) reports that domestic tungsten prices have recently been trading sideways, with a standoff between buyers and sellers—neither side willing to concede on price. Most downstream players are maintaining a wait-and-see attitude and delaying purchases, prioritizing the consumption of existing inventories. Meanwhile, on the supply side, a combination of resource conservation policies, cost support, and a reluctance among holders to sell at lower prices limits the scope for any significant further decline in prices.

Notably, despite a sharp correction in tungsten prices since the second quarter, listed companies in the tungsten industry posted impressive results for the first half of the year, buoyed by a significant year-on-year rise in average prices during that period. Data shows that several tungsten enterprises—including CTG New Materials (Zhongtung Gaoxin), Zhangyuan Tungsten, and Xianglu Tungsten—projected year-on-year increases of over 200% in net profit attributable to the parent company for the first half of the year.

Supply Side Faces Multiple Rigid Constraints

Although tungsten prices are currently trading sideways, multiple rigid constraints on the supply side have established a relatively solid price floor.

At the policy level, the *Regulations on the Implementation of the Mineral Resources Law of the People's Republic of China* came into effect in June, officially designating 36 minerals—including rare earths, tungsten, and lithium—as national strategic mineral resources. On June 25, the National Mine Safety Administration issued a directive regulating the excavation and stripping teams at metal and non-metal mines, further increasing compliance costs for tungsten mining.

CTG New Materials previously stated at an earnings briefing that, regarding the supply-demand structure, policies controlling total domestic tungsten mining output remain strict, and the release of new compliant capacity is limited. Coupled with resource depletion at aging mines and the long lead times required for resuming production or commissioning new mines, the supply of raw materials remains highly inelastic throughout the year. Meanwhile, downstream demand—spanning cemented carbide, cutting tools, photovoltaic tungsten wire, and high-end military materials—is recovering steadily, maintaining a tight balance between supply and demand.

Disruptions to overseas supply cannot be ignored either. The U.S. Department of Commerce’s Bureau of Industry and Security (BIS) recently announced that, effective August 27, it would implement export controls for one year on tungsten scrap and "black mass" derived from lithium-battery recycling. Under the new regulations, sellers of these materials must prioritize domestic U.S. buyers for 100% of sales; exports are prohibited in principle, with exemptions granted only on a case-by-case basis. "The global tungsten supply currently exhibits inelastic characteristics; as the world's largest holder of tungsten resources, my country possesses advantages across the entire industry chain." Industry insiders suggest that tungsten prices have gradually retreated to a range supported by production costs, leaving limited room for further decline. From a medium-to-long-term perspective, policy shifts are expected to exacerbate supply tightness and potentially drive up the baseline price level.

Tungsten Prices Poised to Stabilize and Rebound as Peak Season Approaches

While supply continues to tighten, demand is also gathering momentum for a recovery. Market activity is expected to increase further, driven by the continued growth of emerging demand—such as for AI PCBs and tungsten hexafluoride—alongside the approaching peak season for traditional staples like cemented carbides and cutting tools.

Recent quotes from tungsten companies indicate signs of price stabilization. In the first half of August, both Zhangyuan Tungsten and Xianglu Tungsten raised their long-term procurement prices by RMB1,000  per tonne compared to the second half of July. Xiamen Tungsten set its long-term purchase price for APT (ammonium paratungstate) at RMB606,000 per tonne for the first half of August; this marked the company's first public announcement of long-term prices since late 2025, when the price stood at RMB570,000  per tonne.

Meanwhile, research reports from various institutions express a generally optimistic outlook for future tungsten prices. A report by Minmetals Securities notes that as overseas cutting tool manufacturers implement another round of widespread price hikes, the cost-performance ratio of high-end Chinese cutting tools is improving rapidly. With essential downstream demand becoming prominent during the traditional peak consumption month of September, tungsten prices are expected to gain fundamental support.

"In the short term, July and August are traditionally slow months for tungsten consumption; prices are expected to begin trending upward once the peak season kicks off in September and October," stated CSC Financial in a recent report. From a medium-term perspective, the report highlights that both traditional consumption of tungsten concentrate and new demand driven by the AI ​​wave—specifically for PCB micro-drills and tungsten hexafluoride—are in a growth cycle, pointing to an upward trend in tungsten concentrate prices over the medium to long term.

China Post Securities anticipates that the tungsten market will maintain a tight supply-demand balance throughout the year. New U.S. regulations may widen the price gap between domestic and international markets, and with inventory levels declining further, there is significant support for tungsten prices. Xiangcai Securities notes that, in the short term, costs and supply constraints are providing a floor for prices, setting the stage for an upward move driven by a recovery in end-user demand following the off-season. (Source: Shanghai Securities News)

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