Super Typhoon "Du Surui" May Interrupt the Supply Chain of China’s Tungsten Industry

Analysis of latest tungsten market from Chinatungsten Online

China’s ammonium paratungstate (APT) and tungsten powder prices continue to keep stable on July 26, 2023. 

On the one hand, concerns about the pressure on the cost side, the relatively stable market for raw materials and ore end makes traders less emotional to sell goods at a profit; on the other hand, they are worried about the pressure on the demand side, and the consumption status of downstream tungsten alloys is not active enough , affecting the overall weak trade sentiment. At the end of the month, the market has a strong wait-and-see mood, waiting for the update of the market outlook.

The super typhoon-level "Dusuri" is about to land, and the predicted path may land from the coast of Fujian and Guangdong, and travel all the way to the northeast of Jiangxi, involving cities such as Xiamen, Chaozhou, Longyan, and Nanchang.

According to Chinatungsten Online, this line is an important raw material supply belt for tungsten. Most of China's major tungsten smelters are located in this area, and Ganzhou, the world's tungsten capital, is also within the influence radius of this typhoon. It can be predicted that if the landing of "Du Su Rui" causes major local environmental damage, including the destruction of roads, electricity, water and other facilities, the tungsten industry will face serious risks of supply chain interruption. 

On the macro front, the International Monetary Fund (IMF) raised its forecast for global economic growth this year to 3% from 2.8% in April, and maintained its forecast of 3% for next year. China’s economic growth forecast for this year and next remains unchanged at 5.2% and 4.5%, but the composition of growth has changed. The real estate market continues to slump, investment performance is poor, and net exports are stronger than expected, offsetting some of the weakness in investment. 

It is worth noting that, according to Chinatungsten Online, the export volume of China's tungsten products in the first half of 2023 will drop by nearly 30% year-on-year. Among them, the export volume in June is still declining month-on-month, with a drop of nearly 20%, and a year-on-year drop of more than 40%. The data shows that the current export status of tungsten products is not satisfactory, and the risk of insufficient endogenous power may intensify market pressure. However, judging from the optimistic expectations of China's economic growth by global mainstream institutions, the driving force of the market economy will be further strengthened in the second half of the year, and attention should be paid to industrial risks and opportunities.

Prices of tungsten products on July 27, 2023

Picture of tungsten trioxide 

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