Tungsten, dubbed “industrial teeth”, enters tight supply‑demand balance amid fresh demand from computing and new‑energy sectors

According to Securities Daily, tungsten, widely known as the “industrial teeth” thanks to its outstanding hardness, high melting point and excellent wear‑resistant properties, has moved into a tight supply‑demand balance in recent years. Price benchmarks across global trading markets are trending firmly upwards.

Dual drivers on the supply and demand sides underpin the current booming market. New production capacity is slow to come online. Consumption within conventional downstream sectors stays steady, while computing‑power infrastructure and new‑energy industries generate additional incremental demand. This creates fresh commercial opportunities for leading domestic enterprises operating in this sector.

Market figures compiled by Wind show tungsten concentrate was quoted at RMB 415,000 per tonne on 17 September. This represented a rise of 199.64 per cent compared with the quotation of RMB 138,500 per tonne recorded on the equivalent date in 2024. The commodity has experienced volatile price movements over the course of this year. It hit an intrayear peak of RMB 1,050,000 per tonne back in March, and the latest quotation marks a 60.48 per cent fall from that high‑water mark.

Research reports released by Guojin Securities analyse the fundamental outlook. Ore grades at operational mines are gradually declining, and there is limited scope for commissioning new mines both domestically and overseas, keeping supply under sustained pressure over the medium‑to‑long term. The construction of artificial‑intelligence computing infrastructure will continue to lift consumption of printed‑circuit‑board drill bits. Expanding memory requirements will further boost procurement of tungsten hexafluoride and upstream high‑purity tungsten powder. Against a backdrop of steady growth in medium‑term demand, ongoing supply constraints and upgraded overseas strategic stockpiling, the tight supply‑demand balance will hold, and there remains scope for the price benchmark to move further upwards.

Industry commentators state that tungsten prices will fluctuate at high levels for a considerable period. Supply shows low elasticity, and incremental demand will keep opening up room for consumption growth. Nonetheless, acceptance levels among downstream industries will curb sharp price surges, making another unilateral sharp rally unlikely.

China holds a globally leading position in tungsten reserves, concentrate mining, smelting and hard‑alloy production capacity. Riding on the upswing in sector prosperity, A‑share listed companies along the tungsten industrial chain posted substantial profit growth in the first half of this year. China Tungsten Hi‑Tech recorded net profit attributable to shareholders of RMB 2.076 billion, up 280.53 per cent year‑on‑year. Chongyi Zhangyuan Tungsten registered RMB 688 million attributable net profit, representing a 497.38 per cent year‑on‑year increase. Guangdong Xianglu Tungsten reached RMB 482 million attributable net profit with a year‑on‑year jump of 2522.40 per cent. Xiamen Tungsten achieved attributable net profit of RMB 2.201 billion, rising 127.04 per cent, while China Rare Non‑Ferrous Metals posted attributable net profit of RMB 403 million, an increase of 456.51 per cent.

Value distribution across the complete tungsten industrial chain follows a smile‑curve pattern. Upstream mining operations deliver the strongest profit elasticity during an upward market cycle on account of resource scarcity. Mid‑stream smelting features comparatively low entry barriers and fierce market competition, which easily squeezes profit margins. Downstream deep‑processing is subject to substantial technical barriers. The rapid expansion of computing‑power and new‑energy industries continues to enlarge the market for high‑value hard‑alloy products.

Listed enterprises are pushing forward strategic investment arrangements covering upstream mineral resources and downstream high‑value processing segments. China Tungsten Hi‑Tech completed two acquisitions in 2024 and 2025 to reinforce its upstream mineral base, securing an annual output of more than 10,000 standard tonnes of tungsten concentrate. Its wholly‑owned subsidiary, Zhuzhou Cemented Carbide Group, is pressing ahead with the technical renovation and capacity‑expansion project for 30 million PCB drill‑rod units in accordance with established plans.

Guangdong Xianglu Tungsten runs an integrated tungsten business covering ore dressing, ammonium paratungstate smelting and finished‑goods manufacturing. The main factory buildings for its 30‑billion‑metre ultra‑fine tungsten‑wire project for photovoltaic usage have been finished. Auxiliary facilities inside the plant are being installed, production equipment has arrived on site successively, and most machinery has entered the commissioning phase. The whole project is in the course of capacity ramp‑up.