Tungsten is one of the strongest naturally-occurring materials, critical across modern technology from smartphones to hypersonic missiles. Listed as a critical mineral in the US, EU, China, UK, Australia and Japan, it's essential for military applications, technology sectors, and electric vehicles (requiring ~2kg per EV). Also vital for mining equipment, energy production, construction, and aerospace.
The appreciation in tungsten prices is underpinned by a confluence of US tariffs, Chinese export restrictions, strategic defense stockpiling, and protracted constraints in primary production.
China imposed export licensing in February 2025 after US tariffs. Tungsten APT exports fell 70% from 782 tonnes in 2024 to 243 tonnes in first 11 months of 2025. Only 15 companies authorized for 2026-27 exports, giving Beijing direct control over tungsten flows. Meanwhile, China's domestic production dropped 10% in 2025 due to ageing mines and environmental restrictions.
With no domestic tungsten production since 2015, the US increased tariffs to 50% on Chinese tungsten products (end 2024) and will restrict defense procurement from China, Russia, Iran, North Korea from Jan 2027. Washington now supports alternative projects globally with massive financing packages, including US$900M EXIM commitment for Kazakhstan's Severniy Katpar mine, containing 10% of global reserves.
Global tungsten production (~85,000 tonnes in 2025) is extremely concentrated: China produces 79% of supply and controls 80-85% of mining/processing. Global reserves (4.7Mt) are also concentrated with China holding 53%. This creates a single chokepoint similar to rare earths markets. Countries classified as "politically unstable" account for 96% of global tungsten supply, highlighting critical supply security risks.
China switched from net exporter to net importer (+153.7% in Jan-Feb 2026). Military demand is up 12% in 2026, semiconductor/AI demand expected to double by 2030, EU electric vehicle registrations rose 48.9% in March 2026, and mining equipment demand increases across all commodities. Critical defense applications in an increasingly volatile world drive unprecedented demand growth.
2024 tungsten demand distribution shows three major sectors dominating consumption: Transport (26%) driven by electric vehicles and automotive applications, Industrial use (26%) for cutting tools and machinery, and Mining/Construction (26%) for drilling equipment. Secondary sectors include Chemical/Pharma (10%) for catalysts and processing, while Consumer Durables (9%), Defence (9%), and Energy (9%) each represent critical but smaller market segments with high strategic value.
The tungsten market is in severe structural deficit with limited new supply. Mine development averages 5-7 years with high costs. Non-China production rose 20% to 19,000 tons in 2025, mainly from China-controlled Kazakh operations. Key developments include South Korea's Sangdong restart (2,300t in 2026), but ex-China supply remains dependent on few restarts and expansions in UK, Canada, Australia and US projects.
While China’s export restrictions initially destabilized the tungsten market, the long-term fundamentals have undergone a structural shift. Demand is accelerating sharply against a backdrop of deteriorating Chinese supply. With non-Chinese projects remaining scarce and subject to strategic premiums, the discourse has shifted: it is no longer a question of the metal’s criticality, but of the West’s ability to re-establish sovereign supply chains before Chinese leverage becomes absolute.
