Why tungsten prices are moving forward?

It is said that no new tungsten projects are coming on-line in the next 12-18 months. Then there is China's role. China accounts for 83% of global production and has considerable influence on tungsten prices.

China is looking to weaken Western producers as it would be more beneficial to maintain healthy prices to fund its businesses, its growth and its move into downstream and higher-margin tungsten products. China can respond quickly to drops in tungsten prices. For example, it was reported in one publication in January that the majority of tungsten miners were unwilling to sell their tungsten concentrate at lower prices because of the bullish outlook. This acts as somewhat of a floor, because the drop in supply would improve pricing.

We're going to see APT prices back up around the $400/Mtu mark, if not by late 2013 then by early to mid-2014.

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JOHANNESBURG (miningweekly.com) –The initial focus of aspirant multi-commodity natural resource asset developer Premier African Minerals on Monday said a recent exploration update from its flagship RHA tungsten project, in Zimbabwe, indicated the potential for development of a low-capital- and low-operating-cost mine in the near term.

A five-hole diamond drilling program undertaken on site confirmed significant tungsten oxide values.

"This update has revealed significant tungsten mineralisation in the form of very coarse wolframite crystals hosted by quartz veins identified from drillhole intersections, and highlights the exceptional prospectivity of our RHA tungsten project,” Premier CEO George Roach said in a statement.

Drilling had also potentially uncovered three previously unknown, well-mineralised quartz veins in the existing lode system.

Further low-cost surface trenching and sampling would be undertaken in the first quarter of the year to confirm the surface location and extent of the hanging wall lodes, with a South African Mineral Codes-compliant resource on target for completion within the first half of the year.

“In tandem with this, we are also completing a conceptual mine study, which will determine the most beneficial and cost-effective method of exploiting the known extent of the RHA deposit,” added Roach.

The conceptual study would consider the possibility of early and low-cost production from the recently discovered outcropping mineralised quartz veins, as well as from existing tailings dams and dumps.

“Given the availability of water and power at the property, and the relative simplicity of the required processing plant, we believe we will be able to start development with a view to production potentially before the end of 2013," Roach advised.

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American National Carbide, a tungsten carbide supplier and high-end toolmaker, has expanded its tungsten carbide scrap recycling facility to handle up to 1 million pounds (1 Mlb) scrap carbide per year.

Tungsten carbide scrap recycling is extremely important for meeting global tungsten demand. Current estimates of supply from recycling for the global tungsten market are about 35%, which is significant because 10 years ago it was 10%. Given that the U.S. doesn't have any producing tungsten mines, it's a positive for the country. With an improved outlook for U.S. manufacturing coupled with the shale boom, tungsten consumption is likely going to increase, and recycling will play a role in offseting any supply shortfalls.

Tungsten Manufacturer & Supplier: Chinatungsten Online - http://www.chinatungsten.com
Tel.: 86 592 5129696; Fax: 86 592 5129797
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Tungsten ranked second behind rare earths in the British Geological Survey's 2012 supply risk index based on a number of factors like location and concentration of production and reserves, but the report highlighted that tungsten (as well as rare earths) has lower recycling and low substitutability.

The supply risk for tungsten stems from China's role in the industry. China accounts for approximately 83% of global tungsten concentrate production and about 62% of global tungsten reserves. China became a significant player in tungsten production in the mid-1980s. By the late 1990s, it had flooded the global market with tungsten causing concentrate prices to plunge below most western producer's variable cost. As a result, the vast majority of western mines were closed.