Tungsten Market Remained Stable After the Holiday, Scrap Tungsten Market Led the Rise in Exploration [SMM Tungsten Daily Review]

SMM January 5

The tungsten market operated largely stable today. Before noon, the market mostly awaited guidance from long-term contracts in the tungsten industry, with a strong wait-and-see sentiment. Many enterprises in sectors like APT suspended quotations, and ore-side transactions were scarce. Pre-holiday inventory in the scrap tungsten market was cleared; post-holiday, some traders held a bullish view, and transaction prices were the first to show an upward trend. The European market saw few transactions, but suppliers' quotations remained firm, quickly following the domestic market's rise, with some APT offers already as high as $1,000/mtu.

Ore side: As of January 5, SMM black tungsten concentrate (65%) closed at 453,000-454,000 yuan/standard mt, largely stable compared to pre-holiday levels. Afternoon market feedback indicated a small amount of ore-side transactions; the transaction price for 55% tungsten concentrate moved up to 453,000 yuan/standard mt, an increase of 3,000 yuan/standard mt from pre-holiday. Continued attention will be paid to guidance from domestic tungsten enterprises' long-term contracts.

Ammonium paratungstate (APT): SMM ammonium paratungstate (≥88.5%) was quoted at 660,000-680,000 yuan/mt, flat from pre-holiday. The operating rate of the domestic APT industry declined significantly in December, spot order circulation in the market was limited, some traders cleared pre-holiday inventory, and industry hidden inventory was low. In January, with production resumptions from previously maintained enterprises, industry production is expected to increase slightly. However, with low industry inventory, the tight circulation pattern is difficult to alleviate in the short term. Today, the European APT market saw few transactions, but suppliers' offers were firm, with some prices already touching $1,000/mtu (approximately 620,000 yuan/mt based on a simple exchange rate calculation).

As of today, tungsten carbide closed at 1,030-1,050 yuan/kg, unchanged from the previous trading day. Tungsten powder prices were concentrated at 1,070-1,100 yuan/kg, flat from the previous trading day. Powder enterprises mostly produced according to orders; the new restocking cycle had not yet arrived, market transactions were relatively stable, the tug-of-war between sellers and buyers intensified, awaiting follow-up from firm orders.

Ferrotungsten: The ferrotungsten market had strong cost support, but downstream steel mills made few purchases, and transactions were average. Today, mainstream quotations for 80% ferrotungsten were concentrated at 665,000 yuan/mt, unchanged from the previous trading day.

Scrap tungsten: Pre-holiday, the scrap tungsten market saw risk-averse liquidation releases; with traders' inventory at low levels, restocking demand increased, market transactions were relatively active, and transaction prices rose compared to the previous period. Today, SMM scrap tungsten rods closed at 600 yuan/kg, up 10 yuan/kg from pre-holiday; other scrap tungsten products also mostly increased by 10-20 yuan/kg.

Short-term, after suppliers took profits pre-holiday, post-holiday market restocking demand exists; some suppliers restocked at lows, driving a short-term improvement in trading volume. However, with prices at high levels, the market mostly awaits guidance from long-term contracts. Quarterly, mines are expected to supply steadily; downstream products like powder still need quantified firm orders to follow. In the absence of strong market news drivers, prices are expected to fluctuate rangebound in the short term. Additionally, the State Council recently issued the "Comprehensive Solid Waste Management Action Plan," which requires strengthening source reduction of industrial solid waste. In principle, no new mineral processing projects will be approved if they lack self-owned mines or supporting tailings utilization and disposal facilities. By 2030, the annual comprehensive utilization of bulk solid waste is expected to reach 4.5 billion mt, and the annual recycling of major renewable resources is projected to reach 510 million mt. Environmental law enforcement and supervision will be intensified to crack down on environmental crimes related to solid waste. From a medium and long-term perspective, this plan may strictly control mineral processing projects of miners without supporting solid waste disposal capabilities, accelerate the exit of small, scattered, and disorderly capacity, and increase the concentration of leading enterprises, leading to expectations of reduced tungsten ore supply. Secondly, it will promote the recycling of secondary resources such as tungsten metallurgical scrap and used products, broadening supply channels while compelling enterprises to undertake environmental protection and technological transformation. SMM will continue to monitor the operational status of mines.