SMM May 12:
The tungsten market recently retreated from highs and remained in the doldrums. The price spread between upstream raw material long-term contracts and spot orders continued to widen. Long-term contract quotes were continuously lowered but the decline remained smaller than spot market transaction prices for spot orders. Wait-and-see sentiment was strong with very few transactions. On May 11, a Guangdong enterprise cancelled its fixed long-term contract pricing for the first half of May and switched to market-based negotiation, shifting pricing power closer to the spot market. This intensified wait-and-see sentiment in the short term while also making raw material pricing more flexible. Scrap tungsten materials stopped falling and stabilized after the previous deep decline, rebounding slightly. Suppliers held back from selling at low prices, providing some support to the market.
Mine side, SMM 65% wolframite concentrates were quoted at 610,000-611,000 yuan/standard tonne (65%WO3 basis) today, down 20,000 yuan/standard tonne from yesterday. Compared with the annual high on March 13, tungsten concentrates prices had cumulatively fallen approximately 42%, with the year-to-date cumulative gain narrowing to around 34.6%. The tungsten market continued to decline recently, and combined with failed auctions in Shaanxi, market transaction confidence remained insufficient. Low-grade ore circulated loosely in the market and some mines had relatively high inventory. Market buying interest was insufficient, and the supply-demand imbalance was gradually transitioning from tightness to slight surplus.
Smelting APT segment, SMM APT was quoted around 970,000 yuan/mt today, down 10,000 yuan/mt from yesterday, down 35.8% from the annual high on March 13, with the year-to-date cumulative gain narrowing to around 44.8%. APT market transactions were sluggish recently. Mainstream enterprises mainly maintained shipments under long-term contracts, but with poor spot order demand, industry inventory pressure increased. Actual transaction prices were significantly discounted from listed prices, and the price spread between long-term contracts and spot orders widened to 200,000 yuan/mt. Downstream powder enterprises mainly restocked on a just-in-need basis. At the beginning of the month, two APT plants in Jiangxi announced production halts for maintenance. Domestic APT production in May is expected to decline slightly MoM, but industry destocking pressure persists. Affected by the continued sluggishness in the Chinese market, ex-China downstream tungsten enterprises had strong wait-and-see sentiment, with purchase willingness for high-priced APT declining notably. The market entered a stalemate, with European APT prices holding steady in the $2,900-3,200/mt range (equivalent to 1.77-1.954 million yuan/mt). The price spread between domestic and overseas markets continued to widen, and export margins recovered somewhat. However, constrained by tungsten product export control policies, export volume growth remained limited, making it difficult to offset the loose spot supply pressure in China, with minimal support for the domestic market.
The tungsten powder market continued to see catch-up declines. SMM tungsten powder was quoted at 1,780 yuan/kg, down 70 yuan/kg from yesterday. Tungsten carbide powder was quoted at 1,700 yuan/kg, down 27.7% cumulatively from the high on March 13. Demand in the powder industry was weak, with insufficient orders from downstream cemented carbide sector. Purchasing was mostly on an as-needed basis, and transactions remained sluggish. Recycled tungsten carbide powder was quoted at 1,040 yuan/kg. The waste tungsten market recently stopped falling and stabilized, and recycled tungsten enterprises showed insufficient willingness to sell at low prices, with the market expected to stop falling and stabilize.
After a deep decline in the earlier period, the waste tungsten market stopped falling and stabilized. Suppliers' hold-back-from-selling sentiment intensified, quotes rebounded slightly, and mainstream transaction prices stabilized, providing certain support for tungsten prices. SMM waste tungsten drill bits and waste tungsten bar prices remained at 680 yuan/kg and 720 yuan/kg respectively, with a cumulative increase of 20-50 yuan/kg over the past two days. Some traders were optimistic about the market outlook and began to enter the market to purchase, with trading volume improving compared to the earlier period.
The ferrotungsten market maintained low operating rates, with both trading volume and supply showing significant declines. Steel mills primarily purchased based on orders. Given the obvious price advantage of waste tungsten, some steel mills chose waste tungsten blocks and other products as substitutes for ferrotungsten. Ferrotungsten continued its weak trend, with SMM 70% grade ferrotungsten quoted at 970,000 yuan/mt, a cumulative decline of 31.4% from the annual high.
Overall, downstream cemented carbide rigid demand recovery remained sluggish, and APT and concentrates prices were still consolidating at lows. In the short term, the tungsten market is likely to remain in the doldrums with consolidation and repair at lows, awaiting demand recovery and convergence signals in the price spread between domestic and overseas markets. From a medium and long-term perspective, supported by the supply rigidity of China's continuously tightening annual tungsten ore mining quotas, the logic of raw material supply contraction remains unchanged, and further downside space has been significantly compressed. The core key to a subsequent market reversal still lies in actual demand recovery in end-use sectors such as downstream cemented carbide, special steel, and PV tungsten wire, as well as concentrated restocking at low price ranges. Patience is needed to wait for the demand inflection point and industry policy direction to materialize simultaneously. Additionally, on May 9, 2026, the State Council executive meeting reviewed and approved the "Regulations for the Implementation of the Mineral Resources Law of the People's Republic of China (Draft)" (hereinafter referred to as the "Draft Regulations"), specifying thestrategic mineral catalog, improving theresource reserve and emergency response system, strictly controlling mining rights and extraction order, and strengtheningecological restoration responsibilities. As a national strategic mineral resource, tungsten is significantly affected by policies on industrial supply and demand. Continued tracking of the implementation details and enforcement is still needed going forward.
