Almonty Industries: Tungsten for defence is coming again from Sangdong
Almonty Industries is once again supplying tungsten from South Korea. On September 21, the Sangdong processing plant received its final operating certification, and the first expansion phase has been commercially operational since then. On September 23, the company reported the first tungsten production since 1993. At the International Investment Forum (IIF) on October 7, CEO Lewis Black said the plant was running about 16 hours a day, adding two hours every few days. On October 24, the first commercial tungsten shipment left Sangdong. According to Lewis Black, the milling plant had already been operating at full capacity for around two months. Production is running increasingly smoothly.
The sales picture has also brightened. At the Investor Day on October 19, Black reported that the offtake agreement with Global Tungsten & Powders, one of the largest Western producers of tungsten oxide, had been extended by 6 years, at a higher price over the entire term. The previous discount no longer applies. The second expansion phase is also underway, and the equipment has been ordered. Its impact is expected to become apparent next year. The average price of the intermediate product ammonium paratungstate (APT) was recently USD 2,700 per MTU. This plays into Almonty’s hands.
Additional tailwinds are coming from politics. Lewis Black pointed to US defence procurement rules that take effect on January 1, 2027 and exclude tungsten from China, North Korea, Russia and Iran. Who will fill the gap? Almonty is relying on Sangdong, the reprocessing of old waste heaps at Los Santos in Spain and concentrate from Rwanda. According to government sources, it will be the country’s largest concentrate exporter from November. The project in Montana will also be brought into production, and Panasqueira will be expanded. Bank of America analysts set a price target of USD 24.00.
Rheinmetall: Ammunition, shipyard and satellite from a single source
On October 16, Rheinmetall started producing medium-calibre ammunition in Albacete, Spain. The site will produce around 3 million components annually, including 1.2 million projectiles and 1.8 million cartridge cases. The site is part of the Firepower project. The group invested around EUR 20 million, and the workforce is growing from around 210 to around 300 employees. The group is also making progress in the UK. The weapons production facility in Telford opened on October 22, with an empty hall transformed into a manufacturing facility in eight months, significantly increasing the group’s ammunition capacity.
On October 19, Rheinmetall also announced it would acquire the Mangalia shipyard in Romania, along with shipping company MSC. The two partners won the auction with a bid of around EUR 138 million. Completion is expected in a few weeks. The shipyard will be used for civilian and military purposes and will build four naval vessels for Romania, including two patrol vessels measuring 96 m in length. Financing for growth is in place, as the group doubled its credit facility ahead of schedule from EUR 750 million to EUR 1.5 billion on October 8.
Business is also growing in space. On October 1, the first joint satellite from Rheinmetall Italia and Argotec for military airspace surveillance launched on a SpaceX Falcon 9. It is intended to test the functions in orbit. The modular programme is designed to run over several years, with another launch planned for 2028. Whether the subsequent funding phases will follow remains undecided. On October 6, the Bundeswehr also gained direct access to radar satellites under the SPOCK 1 programme. Third-quarter figures will follow on November 5.
SpaceX: Third-quarter profit and national security contracts
On October 20, SpaceX presented its third-quarter figures. Revenue rose 161% to USD 14.6 billion, up from USD 5.6 billion a year earlier. Net profit was USD 4.4 billion, compared with a loss of USD 1.1 billion the previous year. Adjusted EBITDA climbed 306% to USD 8.8 billion. The biggest driver was the artificial intelligence computing business, branded Super Intelligence, which generated USD 7.6 billion in revenue. Starlink contributed USD 5.2 billion in the Connectivity segment. Revenue went through the roof.
Starlink added 1.6 million consumer customers during the quarter, bringing the total to 13.6 million. Business with companies and government agencies grew 91%, partly thanks to Starshield. Starship flight 14 reached orbit for the first time, delivering 26 terabits per second of bandwidth, according to CEO Elon Musk. Flight 15 is set to follow in November, with an attempt to catch the booster and spacecraft. Musk considers success more likely than failure, but it is not guaranteed. Starlink Mobile has more than 22 million monthly users.
Defence also plays a role. Six of the 35 launches during the quarter were national security missions, and SpaceX says it has signed 18 more such contracts. The order backlog stands at USD 63 billion, of which USD 42 billion is expected to become revenue within 12 months. For the first quarter of 2027, the company is targeting revenue of USD 33 billion to USD 37 billion. At the same time, capital expenditure is rising from USD 19.6 billion in the third quarter to USD 35 billion to USD 40 billion in the fourth quarter. The stock remains exciting.
Conclusion
Those looking at raw materials, defence and spaceflight together will arrive at these three companies. Almonty Industries is once again supplying tungsten from Sangdong and has extended an offtake agreement by six years on improved terms. If the further ramp-up succeeds, the company could benefit from the US procurement rules taking effect in 2027. Rheinmetall is expanding ammunition production, shipbuilding and satellite activities and has doubled its credit facility to EUR 1.5 billion. SpaceX is generating a profit for the first time and has an order backlog of USD 63 billion, but its investment pace means the returns will take time to materialise. All three are performing well operationally.
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