SMM News, March 23
China's spot tungsten market was generally stable today, with quotations for tungsten concentrates, smelting products, and downstream tungsten powder products largely stable. Since major domestic tungsten enterprises released long-term contract prices on March 20, sentiment in China's tungsten spot market has eased slightly. Transactions in tungsten concentrate raw materials were mostly concluded around long-term contract prices, while downstream smelters held firm offers. APT remained in tight supply, with some transaction prices already exceeding 1.53 million yuan/mt. End-users mainly restocked for rigid demand, and no large-volume deals were seen in the market. The tug-of-war between longs and shorts entered a balanced state, and the overall trading atmosphere remained cautious. This week, attention can continue to focus on the tender sale of tungsten concentrates by a miner in Yunnan.
Mine side: Today, 65% wolframite concentrates were steady at around 1.02 million yuan/standard tonne (65%WO3 basis). Customs data showed that China's total tungsten concentrate imports in January and February were about 5,195.7 mt, up 153.7% YoY. However, domestic tungsten ore production fell significantly in January and February. Coupled with the industry's continued crackdown on illegal mining, regional environmental protection checks, and quota controls, the increase in imports was insufficient to offset the decline in domestic production. Spot circulation in the tungsten ore market remained tight. Entering late March, some enterprises in Yunnan and other regions gradually received approved quotas and began shipments, which may improve market circulation. However, the current high prices and cash-on-delivery settlement method continued to test downstream capital turnover. This week, continued attention should be paid to transactions at the mine side.
Smelting market: Today, mainstream quotations for APT were concentrated around 1.5 million yuan/mt. Smelters faced significant cost pressure in raw material procurement. In addition, with the industry's operating rate staying at a low 60%, spot circulation was relatively tight, and APT producers held firm offers, with some transactions rebounding to around 1.53 million yuan/mt. Meanwhile, the 1.5 million yuan/mt long-term contract price boosted market confidence, and the APT market may rebound slightly in the short term. The overseas APT market surged sharply. With logistics disruptions in Europe and continued declines in industry inventory, recent APT transaction prices climbed significantly. As of last Thursday, European APT transaction prices were concentrated at $2,400-2,900/mtu, up $450/mtu from the previous period. Recently, some enterprises reported that spot order transaction prices for APT outside China reached as high as $3,217/mtu.
The powder market was also largely stable in quotations today. Downstream cemented carbide alloy enterprises mainly restocked for rigid demand, while some enterprises had moderate raw material inventory and mainly suspended purchases in the short term. SMM tungsten powder closed at 2,380 yuan/kg today, largely stable from last Friday. Some enterprises had relatively full production schedules for orders and quoted higher prices on optimistic expectations for the future market.
Scrap tungsten market: Today, affected by sell-offs from suppliers in Hebei and other regions over the weekend, spot transaction prices in the scrap tungsten market edged down slightly. Some suppliers showed strong risk-avoidance sentiment and took profits, while scrap tungsten alloy smelters mainly restocked on dips. SMM scrap tungsten drill bits closed at 1,245 yuan/kg, down 10 yuan/kg from the previous trading day, while domestic inserts fell by 10-20 yuan/kg. After tungsten, as the market cleared inventory and trading volume improved, sentiment in the scrap tungsten market improved somewhat, and spot transactions are expected to remain stable and improve tomorrow.
Ferrotungsten: Recently, steel mills showed strong wait-and-see sentiment toward procurement, and ferrotungsten trading volume was relatively small. Some steel mills reported fewer orders from end-users, and production of some tungsten-containing special steel grades fell significantly recently. China's ferrotungsten market showed weakness in both supply and demand, but under cost pressure, domestic ferrotungsten enterprises held firm offers. Today, mainstream quotations for 80% ferrotungsten were concentrated at 1.42 million yuan/mt, largely stable from the previous trading day.
In the short term, prices along the tungsten industry chain still showed divergence between primary and recycled products. China is currently in a transitional period marked by tightening raw ore supply and rising recycled usage, and smelters still need time to adjust their restocking habits, completing the transition from a mine-led long-term agreement pricing model to a scrap tungsten procurement model featuring high-frequency transactions and greater sensitivity to sentiment. This decline in scrap tungsten prices was driven more by the concentrated short-term release of supply and panic in market sentiment, causing an overshoot, rather than a trend-based weakening in industry fundamentals. As panic-driven selling is gradually cleared and smelters begin restocking for rigid demand, scrap tungsten prices will gradually stop falling and stabilize, and the price spread with primary tungsten products will return to a reasonable range. This week, the focus should be on mine transactions and the APT industry's operating rate.
