how much more proof do you need- the recent bubble in prices for tungsten is only the beginning- remember when the world went rare earth mad and all rare earth stocks went through the roof- well tugsten is being named rarer than rare earths - all the info is out there - those with one of the worlds rarest commodity will benefit substantially- bring on the dfs-offtake-finance
The World Is Running Low On Tungsten| Why You Should Care
Posted by bangoben on March 15, 2012No comments
Eric Savitz, Forbes Staff 3 comments, 0 called-out + Comment now + Comment now Guest post written by Pierre Monet.Pierre Monet is CEO of Malaga Inc., a Montreal-based mining company with operations in Peru.
Last month, Warren Buffett and Berkshire Hathaway unit IMC International Metalworkingagreed to invest $80 million in a tungsten mining project in South Korea, which was once the world’s biggest tungsten producer.While the deal may come as a surprise to the outside world, those with knowledge of tungsten understand that it’s a crucial but disappearing resource that continues to affect all of us.
A Hard Metal That’s Hard To Get
Tungsten (W) is among the the world’s hardest materials. The metal’s ability to withstand extreme temperatures – particularly high heat – makes it irreplaceable in applications such as cemented carbide tools (which accounts for 50% of its use), “hard steel” drill bits for oil and gas exploration, rocket engine nozzles, cathode-ray tubes as well as vacuum tube filaments, and (for the time being, anyway) filaments in incandescent light bulbs. (The latter only accounts for 3% of its use.)
Increasingly, tungsten is finding its way into new technologies. Its hardness, stability and ability to withstand extreme temperatures make it desirable in the manufacturing of electrodes and components used in touch screens. With the explosion of touch screen technology in smart phones and tablet devices, demand for tungsten target, which already was growing six percent annually, is increasing dramatically.
Trouble is, supply is not keeping up.
China, which has more than 80% of the world’s supply of tungsten, has sharply curtailed its exports and as of now is a net importer of this precious element. China also shows no signs of loosening the reins on tungsten exports, preferring instead to use its supply for its own manufacturing applications. Ergo for the foreseeable future, the rest of the world has to look elsewhere for supply.
Russia has some, but keeps 70% of what it has for domestic use. Tungsten alloy has also been harvested and recycled from existing devices and components, but even those sources have now reached their limits and there’s no new significant supply on the horizon.
Currently, that leaves no more than five mines supplying most of the world’s tungsten outside of China and Russia. Consequently, in a recent British Geological Survey report on metals of economic value on the “endangered list,” tungsten was at the very top.
Tungsten Carbide Manufacturing in the US Industry Market Research Report
Posted by bangoben on March 10, 2012No comments
After low prices and low-scale production in the early 2000s, new applications led to rapid growth in demand and prices for tungsten. The Tungsten Carbide Manufacturing industry has grown at a breakneck pace since the middle of the decade, handily recording double-digit revenue growth. The metal’s extremely high toughness and heat-resistance make it essential to various industrial, manufacturing, electronics and oil and gas industries. As China continues to limit mining output, the element’s price will keep rising, and the industry will continue its meteoric growth. For these reasons, industry research firm IBISWorld has added a report on the Tungsten Carbide Manufacturing industry to its growing industry report collection.
Before the mid-2000s, the Tungsten Carbide Manufacturing industry managed minimal growth as demand for increased at a marginal rate. Furthermore, governments held substantial stockpiles of tungsten, creating a depressing condition for prices. Tungsten is typically alloyed with carbon to create tungsten carbide, which is used in a variety of industrial applications, especially in industrial machinery, tools and abrasives. Tungsten and tungsten carbide products have grown in use in machining and drilling applications where material strength is increasingly sought after for quality and productivity enhancements. “As new applications for the metal and its various alloys were developed and demand from the manufacturing sector boomed, prices began to increase and stockpiles began to be sold off,” explains IBISWorld industry analyst Brian Bueno. Subsequently, demand outstripped supply and prices surged. Rapid global economic growth before the recession further intensified demand, and the industry grew at a breakneck pace.
Over the five years to 2012, US production has increased at an annualized rate of 17.9% from about 4,300 metric tons in 2007. In 2012, the industry is expected to manufacture about 9,900 metric tons of tungsten products. Although the recession laid a speed bump in the industry’s way, the continued rise in global tungsten demand, combined with tightened Chinese control of raw mined tungsten, pushed prices higher over 2010 and 2011, Bueno says. As these demand conditions continue to play out in 2012, industry revenue is expected to jump. Over the past five years, Tungsten Carbide Manufacturing industry revenue is estimated to grow 22.4% per year on average.
The industry is anticipated to continue a period of strong growth over the years to 2017. US production of tungsten products is expected to increase as downstream markets in machinery manufacturing and other industrial sectors demand more of the metal and return to health alongside a growing US and global economy. Global trends in tungsten production, such as China’s tightening control of mining output, will also continue to raise prices. Because this industry produces such a specific product, it is dominated by a few specialized companies. It is also concentrated because tungsten manufacturers rely on steady long-term contracts with downstream industries that demand the intermediate tungsten materials that this industry produces. Concentration in this industry is expected to remain moderate because the number of companies does not fluctuate in response to high fixed costs and input costs. For more information, visit IBISWorld’s Tungsten Carbide Manufacturing report in the US industry page.
Concentrated supply of tungsten helps prices increasing steadily
Posted by bangoben on January 10, 2012No comments
The reserve of tungsten is concentrated, China accounted for 65% of the world, China Minmetals reserves accounted for about 75%. According to the U.S. Geological Survey data, tungsten in the world by proven reserves accounts 65%. In China, 90% of the tungsten ore resources concentrated in Jiangxi, Hunan, Henan, Fujian provinces. From perspective of company, about 75% tungsten resources in China belongs to the holding or holding subsidiaries of Minmetals.
The production of tungsten is highly concentrated, China accounted for 85% of the world, Minmetals accounted 60% of China production. But there is still space of improvement for China tungsten concentrated ore production. During 2002 to 2010, China’s total control index of tungsten mining rose slightly, the compound growth rate was 7.8%.However, the actual tungsten concentrate production in 2010 exceeded the target by 50%.
China tightened export controls, and Minmetal account for nearly 80% export quotas. Decline in tungsten export quotas, increase in export tax rate, and the export transfer to high value-added products. China Minmetals have big right to speak about the export in China. Partial APT, tungsten oxide, tungsten powder and its products in three categories of exports, the export quotas of holding companies of China minmetal accounting for average 80%.
China minmetals has high speaking right on tungsten pricing. The tungsten pricing models is: After Ganzhou Tungsten Industry Association Jiangxi Tungsten Group, China Minmetals and Hunan Nonferrous communicating in 5 per month, announce guide price of tungsten (tungsten concentrate, APT, tungsten powder). The price becomes a market benchmark, and cause great influence on market. As Jiangxi Tungsten Group, Hunan Nonferrous Metals are subsidiaries of China Minmetals, so China minmetals has strong voice in pricing.
The complete cost of tungsten concentrate is high. According to the estimation of Secretary-General of Ganzhou Tungsten Industry Association, the cost is over 135,000 yuan / ton. Complete cost including seven aspects – geological exploration of resource costs, the cost of mine construction, mining costs, processing costs, employee wages, environmental costs, management costs. Investors can make adjustment according to specific circumstances.
Considering from enterprise concentration level, the Chinese production and export policies, the cost of production, supply and demand gap, and so on, we believe that the price increasing trend of tungsten will not change.
Tungsten metal supply and demand are under tension maintain, the state is very possible to purchase storage
Posted by bangoben on January 10, 2012No comments
80% of tungsten application is in the rapid development of tungsten carbide, special steel products, high-tech manufacturing, and industrial upgrading, which may accelerate the demand of downstream products.
We expect 2012 export quotas for tungsten ore mining is still tense, the state purchasing and storage resources of tungsten metal is a high probability event, it will be well supported tungsten price. In addition, the international market demand for tungsten remained stable, there are no significant declines in economic conditions, and foreign tungsten prices will remain high. Tungsten export quotas have been strained since last year many times. Since China’s increasing tightened control of strategic metals export quotas, in recent years, the tension may appear again, pushing the foreign price of tungsten and cause certain supports to domestic tungsten price.
As for supply side, China accounted for 70% of global reserves of tungsten, tungsten mining are subject to annual total quantity limit, so the supply of tungsten has always been limited. Since the beginning of the year, market demand is relatively stable with insufficient supply and high production costs, tungsten, APT and tungsten iron prices keep rising trend. With the price of tungsten get into high, intermediate traders began selling short stocks, making the price of tungsten into the trend of adjustment. Third quarter, U.S. and European companies make up inventory, which made tungsten price back to the high level. But on the background that the economic slowdown at home and abroad, tungsten price get adjusted in third quarter, until the recent drop and suppliers do not want to sell, then price get some support. Downstream demand remains relatively strong, and tight supply and demand is expected to maintain.
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