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The Current State of the Chinese Tungsten Market
The Current State of the Chinese Tungsten Market
May 27, 2020

Due to the increase in consumption of tungsten resources in recent years, tungsten recycling and production have become progressively popular, especially in Europe and Asia. Particularly in China, collection programs have significantly improved and many tungsten recycling facilities have been completed.

 

In recent weeks, there has been a steady decline in prices of tungsten concentrates and ammonium paratungstate in the Chinese market due to Covid-19, but it is predicted that the prices will stabilize.

 

The price assessment for tungsten concentrate was down by 3,000 yuan per tonne on April 15, compared to previous weeks.

 

The demand for tungsten products has been increasing over the years, thus resulting in a demand for tungsten recycling. However, in more recent times, many mining companies are hesitant to sell at current prices and would prefer to store the raw materials in warehouses. This is because of the difficulty of sourcing tungsten concentrates in the market, as well as the fact that they are already below their costs of production and expect the prices to remain within the current range in the slow market. For every tonne of concentrates sold, it is inevitable that the mining companies will incur losses.

 

Many small and medium-sized mining companies are currently stoping all production to wait for market price improvements before supplying, while many large-scale tungsten companies are prioritizing the supply of raw materials to their own subsidiary refineries. This will result in a limited amount available for the wider market.

 

Due to many mining companies stocking up on raw materials earlier on in the month, it is expected that demand in the market will continue to be slow.

 

Ammonium paratungstate markets in China are also facing a similar situation as prices have dropped from 118,00 yuan per tonne to 115,000-118,000 yuan per tonne. They are unable to purchase cheap concentrates as well as unable to sell at higher prices, which makes producers reluctant to sell as they prefer to store their products in warehouses in hopes of an increased market in future months.

 

External Resource:

 

https://www.metalbulletin.com/Article/3928120/Latest-news/Limited-room-for-further-price-declines-in-Chinese-tungsten-market-participants-say.html

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