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.

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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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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.

Companies wanting strong tungsten projects in their portfolios are looking to Portugal as a jurisdiction to achieve that goal. Among the group of junior miners exploring Portugal’s mineral wealth is Colt Resources (TSXV:GTP,OTCQX:COLTF), which stated in a corporate presentation that Portugal remains largely overlooked and underexplored despite mining history dating back 2,000 years.

Echoing Colt’s sentiments is Jim Robertson, Director, President and CEO of Blackheath Resources (TSXV:BHR, FWB:04B) who told Tungsten Investing News (TIN) that Portugal’s tungsten mining history dates back to the end of the 19^th century.

Robertson points out that the nation’s Panasaqueira mine is one of the few continuously operating tungsten mines outside of China and it has produced high grade wolframite for over 100 years.  By 2008 when Primary Metals was acquired by the Japanese metal firm Sojitz, Panasaqueira was a turnaround story that was central in a deal worth roughly 20 times earnings and that resulted in a 30-fold return on investment in 3 years.

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Hemerdon Ball tungsten and tin project, conducted by ASX-listed Wolf Minerals, owns major tungsten and tin ores in Britain. JORC, developed by Hemedon project, is the world’s third largest tungsten ore and was associated with tin ore. The company has finished its pre-feasibility study in May, 2011, and the project is planned to be actually completed in 2015, for a capacity of 3,500 tons of tungsten concentrates and 450 tons of tin concentrates.

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Tungsten prices rose strongly throughout 2010 and most time of 2011, as most of the economies outside China recovered from the credit crisis-induced recession and demand for tungsten increased in parallel. At the end of September 2011, prices for Chinese APT had reached US$450-460/mtu, compared to US$330/mtu at the beginning of the year and US$200/mtu at the beginning of 2010.  APT prices are now well above the previous peak of US$300/mtu in June 2005.

Roskill expects to see a market fluctuating around an equilibrium level, but forecasts the market to be in deficit in both 2011 and 2012, before new supply enters the market.  Currently, Roskill expects 2013 to be the tipping point where supply overtakes demand in the tungsten market at some point during the year.  Assuming that the majority of planned projects reach production, then a surplus is expected to develop, although any further delays to new supply entering the market would quickly see a deficit forming and prices would remain higher than in the forecast (probably into 2014).

Given the current levels of APT prices, Roskill expects that the average for the whole of 2011 will rise to a forecast US$430mtu by the end of the year.  Very few of the significant new tungsten projects are expected to deliver any substantial tonnages of tungsten in 2012, so the market will be relying on existing producers to cope with any growth in demand.  As a result, Roskill predicts a further tightening in supplies of tungsten and, therefore, further price rises, with an average APT price of US$475/mtu.

Prices are expected to ease between 2013 and 2015 as the bulk of planned new tungsten production capacity is expected to enter the market.  Demand for tungsten is expected to continue to grow to 2016 and beyond, putting further pressure on the supply side and requiring more new capacity.

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The tungsten market in the 1990s was characterized by oversupply from China with low prices, which force most western producers to cease production, as prices were well below costs of production. However, in 2000, the Chinese government began to impose restrictions on export quotas and remove export rebates on tungsten products.

During these years of excess supply, stockpiles of tungsten were built up by producers and also governmental organizations. These stockpiles overhung the tungsten market and tended to act as a barrier to price rises. Most of the material contained in these stockpiles has now been sold and trends in tungsten prices have correlated more closely to the underlying supply/demand fundamentals since 2005/2006.

The onset of the global recession in 2009 saw a sharp fall in tungsten price. Between the end of 2008 and beginning of 2010, prices for Chinese APT fell by just over 20%, with a similar fall in European prices. Of this price fall, approximately 92% took place in the first half of 2009, with the second half of the year showing early signs of stability. As the global economy started to improve from the fourth quarter of 2009, demand for tungsten also increased. The general improvement in economic sentiment saw prices increase steadily throughout 2010 and the rise in prices accelerated in 2011 as supply of tungsten had struggled to meet the recovery in demand.

The relatively strong fundamental position in the tungsten market is illustrated when tungsten price trends are compared to trends in similar metals such as cobalt, nickel and molybdenum. The fall in tungsten prices was significantly smaller in 2009 than for the other metals , with tungsten prices dropping a maximum of 25%, compared to 70% for nickel, 68% for molybdenum and 43% for cobalt (index = January 2007). The recovery in tungsten prices since the credit crisis and economic recession in 2009 has also been much stronger. While tungsten prices in July 2011 were at 180% of the level recorded in January 2007, prices for cobalt, nickel and molybdenum were all still below the levels of January 2007, with price indices of 64, 64 and 58 respectively. This would seem to be a clear indication that supply of tungsten is relatively tight as prices held up when demand was depressed and have increased strongly now that consumption of tungsten has recovered to pre-crisis levels.

Primary tungsten output increased steadily from 35,650t W in 1998 to just over 56,500t W in 2008, an average growth rate of 4.7%py. Despite the steep drop in demand for tungsten in 2009 output of tungsten increased further to an estimated 61,500t W. This was almost entirely due to an increase of 7,500t W in China, where consumption of tungsten continued to increase despite the economic problems elsewhere in the world. Production jumped again to almost 70,000t in 2010 on the back of a further increase in Chinese output.

Historically, primary production has not been sufficient to supply market demand and has been supplemented by sales from stockpiles. The largest of these stockpiles was located in the former Soviet Union, but is now thought to be exhausted. The US strategic stockpile continues to be drawn down at the rate of around 2 - 3,000tpy.

The credit crisis and the subsequent economic recession in 2009 meant that most companies with tungsten projects in development had to take stock of the situation. Funding for any project was difficult and even now there is a lot of competition for a finite 'pot' of finance. As a result, the timeline for development for most of the major tungsten projects slipped by at least 12-18 months due to these funding delays. From 2011, mine production of tungsten is likely to grow relatively strongly as a number of tungsten projects are due to come on-stream after being delayed by the credit crisis. The majority of the new projects are scheduled to come on stream between 2013 and 2015, but it is always possible that these timelines could slip further meaning that the significant increase in tungsten output would come in the 2014 to 2016 period. Roskill forecasts that mine output of tungsten could grow from 72,000t W in 2011, to around 100,000t W by 2016.

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Market performance: non-ferrous metal plates fell 0.7% last week, performing slightly better than the broader market (Shanghai Composite Index fell 0.7%, Shenzhen Component Index fell 1.44% and CSI 300 Index fell 0.86%). Among the sub-industry, gold market performed better with 0.9% rise while rare metal was the worst performing sector with 1.7% fall). As for the individual stocks, Jiaozuo Wanfang and Yunan Germanium led gains while Orientzr and GEM suffered heavy fall).

Rare metal: market: sharp increase in APT market and fall in praseodymium –neodymium market. The increase of 3.4% in APT price was due to the influence of market guide price, the rising of tungsten concentrate price and the rumor of tungsten purchase. However, considering there are not obvious supports by fundamentals, the upward trend is difficult to sustain. Rare earth market was still weak with Pr-Nd alloy falling 3% and Pr-Nd oxide 4% respectively.

Precious metal market: gold has been headed for a bear market. Factors supporting gold to sustain its high price are conquered one another. Gold market has suffered a heavy fall of 5.2%.

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In the last decade, the price of gold has increased from about 280 dollars per ounce to recent 1,600 dollars per ounce, with a rise of more than 3 times. It was really a gold decade of gold investment.

It has ever been circulated online that fake gold bars with tungsten as its core are likely to appear in the gold market. It is said that these fake can be tested by means of chemistry, weight and X-ray as the density of gold is 19.3 g/cm3 while that of tungsten is 19.25 g/cm3.

Besides, it only cost 50,000 dollars to manufacture a 400-ounce-weight fake gold bar with tungsten core, far cheaper than a pure gold bar with the value of about 480,000 dollars.

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According to the report by the China Securities Journal on Tuesday, the Ministry of Industry and Information Technology is deciding the list of new material industries among the strategic emerging industries. Non-ferrous metal industry alone has reported nearly 100 kinds of new materials, among which titanium and the intensive processing products of tungsten (tungsten carbide) have finally been selected.

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