Tungsten prices reached record highs in 2025, driven by constrained supply and booming demand across photovoltaics, military, and new energy sectors. With China controlling over 80% of global production, prices surged over 210%, impacting manufacturing costs and strategic planning. Companies like Rettek face both challenges and opportunities as they adapt to higher raw material costs while maintaining high-performance carbide products.
Why Have Tungsten Prices Increased Dramatically in 2025?
Tungsten prices spiked due to a combination of supply restrictions, environmental regulations, and rising production costs. China, supplying 82.7% of the global market, reduced its first batch of 2025 mining quotas by 6.45%, with further reductions likely. Mines in major regions operated at less than 35% capacity, and strict environmental inspections shut down numerous small- and medium-sized operations. The average ore grade has declined from 0.42% in 2004 to 0.28% in 2024, increasing extraction costs to over 100,000 yuan per ton. Overseas production expansions have been slow, leaving a significant supply gap.
How Is Demand Driving the Tungsten Market?
Global demand for tungsten has surged in multiple sectors. In photovoltaics, thinner silicon wafers require high-precision tungsten wires, raising the penetration of diamond wire from 15% in 2023 to 60% in 2025, with annual demand exceeding 4,500 tons. Military applications rely on tungsten for armor-piercing cores and missile counterweights. The new energy vehicle sector and aerospace industry also contribute to growing tungsten consumption, with integrated die-casting molds, motor shaft tools, and lithium tungstate in solid-state batteries driving additional demand. Export controls and licensing requirements have further tightened the global market, leading to strategic stockpiling and price increases abroad.
Which Factors Are Constraining Tungsten Supply?
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Quotas and Mining Capacity: China’s quota reductions and limited mine operation rates restrict supply.
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Environmental Regulations: Over 60 mines and smelting enterprises were shut down due to non-compliance, and 30% of processing capacity in Hunan Province is suspended.
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Declining Ore Grades: Lower-grade tungsten ore requires processing 300–400 tons per ton of concentrate, increasing production costs.
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Slow Overseas Output: Kazakhstan and South Korea mines contribute only a fraction of the domestic shortfall, leaving supply tight.
What Is the Short- and Long-Term Outlook for Tungsten Prices?
In the short term, tungsten prices fluctuate between 780,000–950,000 yuan per ton due to low spot inventory and high replenishment demand. Medium-term projections indicate a widening supply-demand gap of 19% from 2025 to 2028, with annual price increases likely at 15–20%. Long-term trends are supported by resource scarcity, strategic value, and slow growth in global supply. Protective mining policies and high costs for overseas projects reinforce a sustained bull market for tungsten.
How Can Enterprises Adapt to Rising Tungsten Prices?
Upstream mining companies can optimize resource utilization to maximize output, while downstream manufacturers should pursue technological upgrades to offset costs. Strategies include:
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Thinning tungsten wires for efficiency
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Recycling hard alloys
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Intelligent transformation and production capacity expansion
Leading firms like Xiamen Tungsten Industry and China Tungsten High-Tech report semiconductor-grade APT gross margins above 40%, demonstrating successful adaptation to high prices.
Rettek Expert Views
"The tungsten price surge represents both a challenge and an opportunity for carbide tool manufacturers. At Rettek, we focus on optimizing material usage, recycling, and process innovation to mitigate cost pressures. By controlling every step from alloy preparation to automated welding, we ensure consistent performance and maintain our competitive edge despite volatile raw material markets."
Conclusion: Navigating the Tungsten Market in 2025–2026
The 2025 surge in tungsten prices reflects a combination of restricted supply and explosive demand across multiple sectors. Enterprises must adopt innovative production strategies, recycling practices, and technological upgrades to remain competitive. Companies like Rettek, with full control over alloy processing and carbide tool manufacturing, are well-positioned to maintain high-quality output while navigating price volatility. Strategic planning, efficiency improvements, and global market awareness are essential to thrive in this evolving tungsten landscape.
FAQs: Tungsten Market and Industry Impact
Why are tungsten prices rising so sharply?
Tight supply, environmental restrictions, declining ore grades, and booming demand in photovoltaics, defense, and new energy sectors drive price increases.
How do export controls affect global tungsten markets?
Export licensing and targeted restrictions reduce international supply, prompting stockpiling and price increases overseas.
What strategies can manufacturers use to manage high tungsten costs?
Companies can implement recycling programs, upgrade production technology, and optimize raw material usage to maintain profitability.
Will tungsten prices continue to rise in 2026?
Industry forecasts suggest a long-term upward trend, supported by a persistent supply-demand gap, resource scarcity, and strategic value in high-tech sectors.