Future of Tungsten Market Seems Bright

Tungsten market could be returning to growth following low prices and oversupply for several years, Roskill noted, an industry analyst.

“With the increasing demand for defense, industry, oil and gas applications, tungsten market fundamentals have changed, just as China's environmental policy has curbed supply and increased cost pressures on producers.” In a 10 year outlook statement, Roskill said.

Supply might be a long-term price driver, as China is the world’s largest producer of tungsten, accounting for more than 80% of tungsten concentrate supply in 2017.

Enhanced environmental restrictions have affected the supply of many metals mined in China and have been seriously affected by environmental and mine safety problems in recent years.

Roskill reported that the Ministry of Ecology and Environment of China will conduct a second round of central environmental inspections in all provinces in the next three years, a move that could lead to mine closures or incitement to compliance requirements leading to increased production costs.

In this case, supply constraints and increased demand will theoretically drive up prices.

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