Highlights
- Tungsten concentrate prices remain resistant at $20,422.5/ton due to weak market demand.
- China’s industrial profits declined 4.3% from January to October, impacting market dynamics.
- Buyers and sellers maintain conservative strategies in a standoff with minimal price movement.
China’s tungsten market continues to experience stabilization in pricing, with minimal movement due to a supply-demand standoff. Key observations from China Tungsten News (opens in a new tab).
Market Trends and Price Levels:
Tungsten concentrate prices are encountering resistance at $20,422.5/ton due to weak downstream demand and cautious buyer sentiment.
Ammonium paratungstate (opens in a new tab) (APT) prices are stable at $337.4/mtu, though trading enthusiasm remains subdued, putting slight pressure on prices.
Tungsten powder prices are holding at $44.8/kg, with tungsten carbide powder at $44.1/kg. Negotiations reflect caution, as traders adopt a wait-and-see approach.
Profit-Taking Sentiment
Traders and suppliers are increasingly looking to lock in profits as the month closes, but there is little willingness to offer discounts, contributing to a transactional standoff.
Demand and Supply Factors
Downstream demand, including steel tenders, remains weak, dampening market activity.
Buyers are negotiating conservatively based on actual needs, while suppliers maintain stable prices despite rising selling sentiment.
Macroeconomic Context
Industrial profits in China fell by 4.3% year-on-year from January to October, reflecting broader economic challenges.
While the mining industry saw a 12.7% decline in profits, manufacturing profits decreased by 4.2%, with only the energy sector showing growth (+11.5%).
Assumptions and Biases in the Analysis
Rare Earth Exchanges reviewed the China Tungsten News (opens in a new tab) inputs with interest. What assumptions does the news source make? Does it exhibit any biases?
We include a table below:
Assumptions/Bias | Summary |
|---|---|
| Assumption of Stability | The article assumes the current stabilization will persist, without exploring potential external shocks such as policy changes, geopolitical tensions, or unexpected shifts in demand. |
| Focus on Demand-Side Weakness | While downstream demand is emphasized as the primary factor influencing price standoffs, the article does not discuss potential supply-side issues like production constraints, environmental regulations, or export policies. |
| Lack of Long-Term Projections | The article focuses on current trends without providing long-term forecasts or discussing how macroeconomic indicators, such as China’s declining industrial profits, could impact the tungsten market. |
| Profit-Taking Assumption | The report highlights a “profit-taking atmosphere” but does not substantiate this claim with specific examples of trading behavior or data on transactions. |
Final Thoughts
The tungsten market in China appears to be in a state of cautious equilibrium, with both buyers and sellers adopting conservative approaches amid weak downstream demand. The stabilization of prices reflects a tentative balance, but the lack of momentum in demand or supply adjustments could prolong the standoff. The broader macroeconomic slowdown in China could pose further challenges to the market’s recovery.
While the analysis provides a clear picture of current dynamics, it could benefit from a deeper exploration of supply-side risks and long-term implications for the tungsten industry. For investors or industry participants, closely monitoring downstream demand trends and macroeconomic indicators will be key to navigating this uncertain environment.
Daniel
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