Tungsten: A Critical Raw Material of Massive Importance to Countless Industries
The tungsten market has undergone structural and fundamental changes over the past year and a half. There are no signs of a reversal. While prices back then ranged from USD 300 to USD 450 per metric ton unit (MTU), they currently exceed USD 3,000 per MTU.
Tungsten is an extremely hard and heat-resistant metal with the highest melting point of any pure metal. It is regarded worldwide as a strategic and important raw material because it is rare and many industries depend on it. The list of applications is long. In the tooling industry, tungsten is used in drills and milling cutters, as well as in aerospace, high-performance batteries, and the defence industry. The semiconductor industry also relies on it for the essential process gas tungsten hexafluoride, and massive supply bottlenecks are already looming this year.
Globally, China dominates the market with an overwhelming share of around 80%. The situation has recently worsened further due to export restrictions and a sharp rise in international demand. Additionally, the US government has banned the import of critical raw materials from China starting in 2027. This widens the gap between demand and availability even further. Western industrialized nations are urgently seeking sources of raw materials originating in the West. Almonty provides the urgently needed solution to the problem.
Strong growth driven by strategy
Many international developments demonstrate just how dramatically the market has changed. At the beginning of the year, the US government announced the establishment of a strategic reserve for rare earths and other critical raw materials to support the national technology industry. This example underscores the new reality of the industry, in which governments and states act as key investor groups and are willing to pay high, strategically motivated prices to ensure supply security.
Experts predict enormous growth for the critical minerals market through 2035. Driven by investments in defence, AI infrastructure, and electrification, the market is expected to double to USD 715 billion, with North America showing the strongest momentum, according to analysts’ estimates. A recent OECD study provides the foundation for this outlook and forecasts that, in the coming years, critical minerals along the supply chains in the defence, energy, and technology sectors will attract the bulk of institutional investors’ capital.
Undisputed Pole Position
Almonty Industries has been producing tungsten in Portugal for several years, thereby acquiring irreplaceable expertise. However, the game-changer is the flagship Sangdong mine in South Korea, which successfully completed the first phase of its production ramp-up a few months ago. This now enables the processing of 640,000 tonnes of tungsten ore annually, yielding 2,300 tonnes of tungsten concentrate.
The next production phase will deliver a significantly higher output starting in late 2027. At that point, approximately 40% of global demand outside of China can be met. Not only does the scale of production stand out, but also the mine’s extremely long lifespan of 45 years. Furthermore, the Sangdong Mine was designed for a low-price environment of around USD 350 per metric ton (MTU), at which attractive margins are already achieved. The current price level of USD 3,000 per MTU promises exceptionally high margins.
With the advanced tungsten project in the US state of Montana acquired last year—which is scheduled to begin production as early as the second half of 2026—Almonty has further strengthened its strategic position and is establishing itself as a source of supply for the enormous demand from the United States. Likewise, the recent relocation of the company’s headquarters to the United States opens up many opportunities. The shares thus become investable for a wider circle of investors, and access to loans and subsidies is significantly facilitated. The Nasdaq listing and the associated capital increase at the end of last year were already an important step.
Learn more about Almonty Industries’ strategic direction and the company’s plans in an interview with IIF host Lyndsay Malchuk and CEO Lewis Black.
Things are set to get exciting at the upcoming 19th International Investment Forum on May 20. Almonty CEO Lewis Black will provide a detailed update on the company.
Extremely high margins due to rising prices
Even though analysts have so far based their price targets on tungsten prices that amount to only a fraction of the current price, they are projecting net margins of over 60% at full production. It is more than realistic that experts will adjust their forecasts toward current price levels and raise price targets based on massively rising profits and cash flows. Furthermore, a justified strategic premium has so far been insufficiently priced in. However, the fundamentally changed market conditions and the significant geopolitical importance make this necessity obvious.
In turbulent market phases, stocks that can decouple from the broader market stand out. Almonty achieves this through its unique position as one of the world’s largest producers of the scarce, highly sought-after critical raw material, tungsten. The sharp rise in the commodity’s price, along with the resulting high cash flows and profits, leads analysts to recommend buying the stock, which offers significant upside potential. The company’s geopolitical weight is substantial—too substantial to be ignored in the stock price, which commands a significantly higher premium.
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