The China Syndrome Tungsten has shown some of the same dynamics that other specialty metals have experienced over recent decades.During the 1980s and the 1990s, China, with the world’s largest reserves and lowest cost of production, flooded the world market. This drove down the price of both APT and WO3 concentrates to below the production cost of most other Mining Drilling Tools producers. Amongst the distortions this produced was that APT prices, driven downwards by Chinese processors, were only marginally above the price of concentrates at about USD$50 per MTU.The distressed price in the world market quickly drove many tungsten mines and APT producers in the Americas, Asia and Europe out of business and led to their closure. Moreover, outside of China, exploration and mine development programs were quickly abandoned.However, the distressed market price for tungsten concentrates and its products began to change in 2003 and more markedly in 2004-2005 propelled by the rapid growth and emergence of the Chinese economy in the world marketplace. As in other metals the rapid growth of Chinese demand for tungsten products for its domestic market triggered a tightening of the availability outside of China which rock drill bits was coupled with the Chinese government’s policy curtailing mining projects and taxing the export of tungsten concentrates in order to conserve resources for future domestic needs. This led to a price surge in 2005 with the price of APT moving rapidly from below $80 to nearly $300 per metric tonne unit (MTU). This in turn sparked a recovery in Tungsten recycling, so the price stayed in the $250 range for the ensuing five years.However, with recycling at its max (37% of global supply in 2010 according to the USGS) and demand for Tungsten still high, the APT price went on a tear upwards to the $460 range.

After that high-water mark the price has been on a slide, briefly rebounding at times on the way down but now down to the level less than half the 2011/2 highs.Just as in Rare Earths and other specialty metals the Chinese government has indulged in curtailment of mining programs and was strongly “encouraging” downstream processing of concentrates to Rock Drilling Tool higher value added products such semi-finished and finished tungsten products.Roskill’s latest Tungsten survey commented that they believed primary tungsten supply will continue to be dominated by Chinese mine production in the years to 2018. However, the share of global supply which China provides is forecast to fall from 80% in 2013 to 78% in 2018, caused by an increase in production from mining operations in Vietnam, Australia and Europe.

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