https://www.chemanalyst.com/NewsAndDeals/NewsDetails/tungsten-market-split-german-defense-deals-push-prices-up-while-us-stays-flat-31434Tungsten Market Split: German Defense Deals Push Prices Up While US Stays Flat
- 14-Nov-2024 8:30 PM
- Journalist: Shiba Teramoto
The global Tungsten market exhibited varied price patterns in October, with Germany recording a 1.3% price increase due to strong defense sector demand, while the US market remained stable supported by new supply agreements and steady consumption patterns.
Germany's price surge was primarily driven by robust downstream demand, particularly from the defense sector. A significant development in this space is the finalization of a collaborative effort between Germany and the United Kingdom for the development of 120mm Enhanced Kinetic Effect (EKE) tank ammunition. The agreement with Rheinmetall Waffe Munitions (RWM) marks a crucial milestone, as the advanced ammunition, featuring a high-performance Tungsten penetrator, which will be deployed in both the UK's Challenger 3 and Germany's Leopard main battle tanks. Adding to Germany's Tungsten landscape, the Saxon Mining Authority has approved plans for a new mining operation in Pöhla, located in the Ore Mountains. This development aims to extract valuable minerals including Tungsten, tin, and fluorspar, potentially strengthening domestic supply chains. The country continues to maintain strong supply relationships with key partners, notably the UK, while traditional suppliers such as Canada and Switzerland have sustained their export volumes.
In the United States, despite stable prices, the market witnessed significant corporate developments. EQ Resources Limited has established a significant five-year contract with Elmet Technologies for the supply of Tungsten concentrate, which strengthens the domestic supply network. Simultaneously, EQR's Barruecopardo facility in Spain achieved record monthly production levels, indicating improved operational efficiency. However, the industry faces challenges as evidenced by the financial struggles of Tungsten West Plc, operator of a major Tungsten mine in Plymouth. The company is currently seeking urgent financial support of £2 million to prevent insolvency, following a substantial £10.33 million deficit. This situation highlights the operational and financial challenges facing some players in the Tungsten mining sector.
While Germany's Tungsten market is buoyed by strong defense sector demand and strategic developments, the US market maintains stability despite experiencing both positive developments in supply agreements and challenges in mining operations. Looking ahead, the industry's trajectory will likely be influenced by the success of new mining ventures, the stability of existing operations, and the sustained demand from strategic sectors such as defense. ChemAnalyst anticipates an upward trend in the prices of Tungsten for the forthcoming months. This positive market outlook is reinforced by the metal's crucial importance in key industries, including defense, maritime construction, and the manufacturing of superalloys. As Germany and the United States continue to invest in these sectors, a robust and enduring demand for Tungsten is expected, which should underpin its price trajectory.
