Tungsten Supplies Under Threat

    MoneyWeek has reported that supplies of tungsten are desperately short.notes Don Miller in Resource Investor. “Tungsten prices have rocketed from about $180 three years ago to roughly $430 per metric ton today”.

  

    In a recent British Geological Survey report, tungsten even got right to the top of the 'endangered list' of metals of economic value.

    Why? It’s down to China. The country has been buying up raw supplies of tungsten and curbing exports of the metal. As the Chinese control 60% of the world’s reserves and 83% of global production these restrictions have had a big impact. In fact, China is now a net importer of tungsten and expects to use all its supplies to support its own manufacturing firms.

Sure, as we’ve pointed out before, the country’s growth rate is slowing fast, and could drop a lot further.Matthew Partridge said in February, despite this, the Chinese still plan to double their military spending by 2015. That will mean more weaponry – and extra need for tungsten to make bullets and missiles. So the shortage is likely to get much worse.

    

“That means the rest of the world is scrambling to find new resources and open new mines [which] takes a minimum of three years”, says Miller. Yet “tungsten mines are very difficult to operate, processing large amounts of material to harvest relatively small amounts of metal. No more than five mines supply most of the world’s tungsten outside China and Russia”.

  

  No wonder that the US and the EU have recently highlighted tungsten as a key strategic metal that needs stockpiling.