The recent volatility in tungsten prices is fundamentally a story about policy, not just market cycles. China's deliberate control over its vast tungsten resources has created a structural supply shortage, keeping prices elevated even after a recent pullback from record highs.
To understand the situation, we have to start with China's market dominance. According to the U.S. Geological Survey (USGS), China accounted for about 79% of the world's tungsten mine production in 2025. This concentration gives Beijing significant leverage over global supply and prices, and recent policy moves show a clear intent to use it.
The causal chain of events began with direct supply restrictions. First, in early 2025, China's Ministry of Natural Resources announced a reduced first-batch mining quota, signaling a tighter supply outlook. Second, and more critically, in February 2025, Beijing added key tungsten products to its dual-use export control list. This wasn't a blanket ban, but it severely restricted exports of crucial intermediate materials like Ammonium Paratungstate (APT), the feedstock for most tungsten products. Third, in January 2026, these controls were tightened further for specific destinations, effectively halting shipments to major importers like Japan for several months.
These policy actions had a dramatic effect on the market. With supply choked at the source, prices for tungsten concentrate in China skyrocketed over 500% from May 2025 to a peak in March 2026. This price shock rippled through the global supply chain, with European APT prices nearly tripling. While prices have cooled since the March peak, they remain far above historical levels, reflecting the persistent underlying tightness.
Adding fuel to the fire is a strengthening demand picture. As global manufacturing activity picked up in 2026, demand for tungsten-heavy products like carbide cutting tools and aerospace alloys grew. This robust downstream demand collided with the artificially constrained supply, amplifying the upward pressure on prices. In essence, the market is caught between China's policy-driven supply cuts and a healthy, cyclical recovery in demand.
- APT (Ammonium Paratungstate): A key intermediate chemical compound in the process of refining tungsten ore into pure tungsten metal and powders.
- Dual-use export control: Regulations that govern the export of goods and technologies that can have both civilian and military applications.
- WO3 (Tungsten Trioxide): A chemical compound of tungsten and oxygen, often used as a benchmark for the tungsten content in concentrates (raw ore).