Rising Tungsten Prices: Market Dynamics and Outlook Amidst Macroeconomic Fluctuations

Analysis of latest tungsten market from Chinatungsten Online

As summarized by Chinatungsten Online on Monday, the macroeconomic fluctuations and outlook for tungsten product prices during the May Day period are consistent, and similar to the increase in high-speed rail ticket prices, there has been a significant surge! 

With recent news driving factors such as long-term contract prices from tungsten companies, environmental inspections, and rising prices of alloy products, there is a strong momentum pushing towards the 150,000 yuan/ton mark for tungsten ore prices, despite the still unstable market demand foundation.

According to Chinatungsten Online's statistical data, as of now, the price of 65% black tungsten concentrate has risen by 19.5% to $21,000.0/ton since the beginning of the year; the price of 65% white tungsten concentrate has risen by 20.7% to $20,857.1/ton; the price of ammonium paratungstate has risen by 18.7% to $348.7/mtu; tungsten powder prices have risen by 17.2% to $45,714.3/ton; tungsten carbide powder prices have risen by 17.5% to $45,000.0/ton; ferro tungsten prices have risen by 21.6% to $30,571.4/ton; tungsten bar prices have risen by 10.3% to $53,571.4/ton. 

At this point, there are increasingly divergent views among market participants on whether tungsten prices can continue to rise, especially considering one of the main resonating factors of this strong market trend—the recent downturn in prices of bulk commodities such as gold and copper.

Chinatungsten Online believes that the short-term decline in copper prices indicates the direct impact of current monetary policies on commodities with strategic significance and financial attributes. However, in the long run, interest rate cuts and loose monetary policies in various countries will inevitably lead to an overall rise in prices. Tungsten, molybdenum, and rare earths, which have important strategic value and scarcity, will all rise sharply at any time. Therefore, after a significant short-term increase in tungsten prices, stabilization or slight adjustments are normal breathing processes. Looking at the longer term, it is an inevitable trend to see a long bullish candlestick.

Recently, weak US employment data and hawkish statements from Federal Reserve officials led to a rebound in the US dollar index, putting pressure on copper prices to fall below $10,000. The Swedish central bank has become the second developed economy to adopt an accommodative stance after Switzerland, cutting interest rates for the first time in 8 years. The European Central Bank may start cutting interest rates at its interest rate meeting on June 6. After the Bank of Japan's decision to raise interest rates for the first time in 17 years in March, expectations for another rate hike in June have increased.

It is worth noting that the processing capacity at the smelting end has increased significantly in just a few years, causing tungsten ore prices to rise due to shortages, while the digestion capacity at the backend of the industry chain is determined by the market outside the industry chain. The most direct consequence of the short-term rise in tungsten raw material prices will be a comprehensive test of the backend's technological capabilities, management levels, and profitability!

Prices of tungsten products on May 10, 2024

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Picture of tungsten ore

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