SMM News, August 28
The tungsten market saw sideways consolidation across August with divergent performance along the industrial chain. The first‑half month extended the range‑bound trend since mid‑July, marked by thin trading volumes. In late August, policy‑driven sentiment lifted mine‑end prices modestly, while smelting, powder and finished product segments downstream remained under pressure.
Mine‑end prices demonstrated resilience amid clearance of low‑cost spot supplies and flood‑season output cuts at mines. SMM daily average price for 65% black tungsten concentrate hit RMB 418,500/ton on August 21, before easing slightly to RMB 417,500/ton. By contrast, domestic APT prices trended lower: assessed at RMB 610,000/ton on August 3, APT fell to RMB 605,000/ton on August 7 and slipped further to RMB 601,000/ton on August 21, closing at RMB 598,000/ton as of August 28. A total monthly decline of RMB 12,000/ton (-1.97%) made APT the worst‑hit intermediate product in the chain.
Long‑term contract prices in August best illustrated this chain‑wide divergence. Early‑August (August 5): Ganzhou Tungsten Industry Association released its August forecast, setting APT reference at RMB 606,000/ton, down sharply by RMB 54,000/ton month‑on‑month. On the same day, a major Xiamen‑based tungsten enterprise resumed long‑term contract quotations with APT procurement at RMB 606,000/ton. A Chongyi‑based tungsten producer set its early‑August long‑term contract for standard‑grade zero APT at RMB 606,000/ton, up a marginal RMB 1,000/ton from late July.
Late‑August (August 20‑25): The Chongyi‑based tungsten firm published its late‑August long‑term terms: it raised 55% black tungsten concentrate price to RMB 415,000 per standard ton (+RMB 3,000), while cutting APT to RMB 600,000/ton (-RMB 6,000). This marked the first directional divergence between mine feed and smelting product prices. A Guangdong tungsten producer confirmed the same pattern on August 25, lowering its late‑August APT long‑term contract to RMB 600,000/ton, down RMB 6,000 from the first‑half level.
Spot tightness became evident for tungsten concentrate in August. Safety inspections forced production curtailments at some Henan mines, while mine inventories in Guangdong and Yunnan continued to draw down, reducing available spot material. Mine operators adopted slow shipment rhythms with firm asking prices, and high‑grade concentrate became scarce in spot circulation. The second batch of national tungsten concentrate mining quota was issued in August, though allocations were mostly at provincial level and not yet distributed to individual mines. Market rumours suggested the second batch saw both year‑on‑year and sequential tightening, calling for close monitoring of quota roll‑out to major mines. Reinforced environmental and work‑site safety supervision further strengthened mine‑side bargaining power. Several mines held tender auctions in mid‑to‑late August, with concluded prices for standard ton concentrate ranging RMB 400,000‑420,000 per standard ton. Mine auction results trended upward through the month: low‑grade lots from a Guangdong mine fetched RMB 337,000‑349,000 per standard ton in early August; another Guangdong mine auction realised RMB 393,000 per standard ton on August 7. Yunnan mine tenders reached RMB 410,200 per standard ton and Henan auctions hit RMB 398,100 per standard ton on August 21, boosting spot sentiment. Nevertheless, poor downstream demand dragged spot activity lower later, and one mine tender saw no successful bids on August 25.
Downstream smelting sectors faced tangible pressure in August. APT producers carried elevated finished‑goods inventories, with some reporting inventory losses stemming from high‑cost raw material feedstock purchased earlier. Domestic APT output edged down month‑on‑month. Amid sluggish off‑season consumption, the segment built up stocks, with some participants willing to offer discounts to clear goods. Safety inspections and labour rectifications limited near‑term mine supply expansion, capping downside risk for concentrate prices. However, APT at RMB 598,000/ton has broken below the RMB 600,000 psychological threshold and nears or falls under cash costs for some smelters, implying cost‑support effects may emerge in September. Cemented carbide and cutting‑tool sectors stayed in traditional off‑season, lacking new order inflows. End‑users maintained low‑inventory operations with strict just‑in‑time purchasing and little willingness for proactive stock build‑up.
China remained a net importer of tungsten content. Customs statistics showed July tungsten concentrate imports stood at 3,942.6 tonnes, up 22.2% month‑on‑month and 88% year‑on‑year. Cumulative imports January‑July reached 19,400 tonnes, surging 107.7% year‑on‑year, driven largely by Kazakhstan (+241.3%) and Myanmar (+98%). SMM projects full‑year 2026 tungsten concentrate imports to hit 34,000 tonnes, a 66% year‑on‑year increase, effectively offsetting domestic output declines.
On the export front, strict dual‑use item controls weighed on shipments. Total tungsten product exports January‑July totalled 7,781 tonnes, down 13% year‑on‑year. APT exports were nearly zero for two consecutive months, and tungsten powder exports fell 26.2% cumulatively year‑on‑year. Non‑regulated products, however, posted robust export growth, including tungsten profiles and tungsten hexafluoride (benefiting from Japanese capacity exits), reflecting a clear structural shift toward higher value‑added deep‑processed exports.
Heading into the widely‑anticipated September market, can tungsten deliver significant price swings? According to SMM, after prolonged sideways movement across June‑August off‑season, September may bring demand‑driven support, yet multiple factors cap upside momentum. First, domestic mining quota controls guarantee rigid primary mine supply, but surging overseas tungsten imports partially offset domestic supply constraints. In addition, domestic tungsten scrap recycling rates improved, with scrap tungsten supply projected to rise roughly 30% year‑on‑year in 2026, further easing raw material tightness. Second, intermediate goods including ammonium paratungstate and tungsten powder sit at high inventory levels, awaiting demand recovery for destocking. Third, traditional downstream cemented carbide consumption remains muted. Many manufacturers are still working through existing stocks and face capital pressure, operating on a production‑to‑order basis. Operating rates may improve with peak manufacturing season, yet demand gains will likely remain moderate. While emerging‑sector tungsten demand for AI‑related PCB materials and tungsten hexafluoride has grown visibly in 2026, such consumption accounts for merely 7% of China’s total tungsten demand. Rising share from emerging applications will require a longer time horizon.
External variables also merit attention. US export restrictions on tungsten scrap took effect in late August, tightening global scrap tungsten availability and lifting raw‑material acquisition costs for overseas smelters. This creates upward potential for overseas APT quotes and may narrow domestic‑overseas price gaps, delivering indirect positive sentiment for China’s market, though it cannot trigger sharp domestic spot rallies in the short run. European and North American summer holidays have concluded, bringing returning overseas inquiries and prospects for sequential export improvement. Still, overseas cutting‑tool producers are also undergoing inventory draw‑down, so foreign demand will likely release gradually rather than triggering impulse bulk buying.
In summary, September will witness market expectations tested against real‑world fundamentals. Large‑scale sharp rallies or slumps are unlikely; range‑bound oscillation with modest upward bias is the baseline scenario. Should traditional manufacturing peak‑season recovery disappoint and downstream orders stay weak, the market may relapse into stalemate. Meaningful upward price space will only open up if genuine consumption recovery in cemented carbide drives substantial inventory destocking in mid‑stream sectors, alongside simultaneous overseas demand improvement. Over the longer term, demand growth from AI, semiconductors and photovoltaic tungsten wire is assured, yet their current volume weight remains limited. Major tungsten price cycles will require convergence of both traditional and emerging‑sector consumption.
![The import and export structure of tungsten products is deeply differentiated[SMM Analysis]](https://imgqn.smm.cn/usercenter/ZsMtd20251217171723.jpeg)
