Gf Securities has released a research report stating that demand for tungsten metal is steadily increasing in high-end manufacturing sectors. The future industry is expected to unlock a long-term demand ceiling, with an anticipated average annual demand growth rate of 2-4% over the next three years.

Over the same period, the growth in global tungsten mine supply is projected to have an average annual increase of about 1-3%. The bank anticipates that the tungsten market will remain in a tight balance over the next three years, with tungsten prices expected to maintain a long-term upward trajectory.

This upward cycle presents opportunities across the entire tungsten industry chain, and companies experiencing simultaneous growth in volume and price deserve particular attention. The main viewpoints of Gf Securities are outlined below.

Demand Outlook

Tungsten is a strategic resource, with demand from high-end manufacturing steadily increasing. Future industries are expected to unlock its long-term demand ceiling. As a strategic metallic resource in manufacturing, tungsten has a long industrial chain and is widely used in high-end manufacturing.

Traditional demand comes primarily from cemented carbide, tungsten specialty steel, tungsten materials, and tungsten chemical sectors. Benefiting from steady growth in manufacturing investment, manufacturing upgrades, import substitution, and energy transition (which drives demand for photovoltaic tungsten wire), the average annual demand growth for tungsten is expected to be 2-4% over the next three years.

Future demand is expected to be underpinned by emerging industries, including future aerospace (core component materials for advanced and efficient aviation equipment and deep resource exploration equipment, such as superalloys in aero engines and gas turbines which often contain tungsten) and future energy (first-wall materials for nuclear fusion reactors require tungsten-based alloys or pure tungsten materials).

Supply Situation

Supply is gradually rationalizing, facing continuous tight constraints, with the industry structure constantly optimizing. Tungsten supply is expected to enter a long-term period of low growth. Over the past decade, tungsten supply has been gradually rationalizing under persistent tight constraints.

With the tightening of tungsten mining quotas in 2025, supply-side concentration is increasing, enhancing the pricing power of upstream players. Over the next three years, the main increments in global tungsten mine supply are expected to come from the Bakuta Tungsten Mine in Kazakhstan, the Sangdong Tungsten Mine in South Korea, the domestic Bobai Judian Tungsten-Molybdenum Mine, and the technical renovation and expansion of the Shizhuyuan Tungsten Mine. The average annual supply growth rate is projected to be around 1-3%.

Price Trend Analysis

The tight supply-demand balance is expected to support a long-term upward price trend. Benefiting from tight supply and strong demand, tungsten prices experienced an unexpected sharp rise during 2025 to the first half of 2026. According to iFinD, the price of tungsten concentrate (65%) fluctuated upwards from 140,000 yuan per ton at the beginning of 2025 to 480,000 yuan per ton by July 1, 2026.

Looking ahead, tungsten prices are expected to continue their long-term upward trend. As mentioned, the tungsten market is forecast to remain in a tight balance over the next three years, supporting the long-term upward price trajectory.

Price Elasticity Factors

Geopolitical disturbances enhance tungsten's strategic attributes, potentially leading to a revaluation of the commodity, raising its long-term price ceiling, and amplifying its upward price elasticity. Recent events such as the Russia-Ukraine conflict, the Israel-Palestine conflict, US-Israel strikes on Iran, and US-China trade conflicts have continuously strengthened tungsten's strategic nature.

The sustained growth in defense preparedness demand, coupled with export controls for non-proliferation purposes, further enhances its strategic value, leading to a revaluation and significantly strengthening the pricing resolve of upstream industries. Looking forward, as the global geopolitical landscape undergoes restructuring, the tungsten industry is expected to gradually accept higher price levels, steadily opening up expectations for a higher long-term price ceiling while harboring potential for significant upward price elasticity.

Investment Recommendations

The upward cycle presents opportunities across the entire tungsten industry chain. Focus should be on companies experiencing simultaneous growth in volume and price.

Xiamen Tungsten Co., Ltd.: An integrated tungsten industry chain enterprise. Its under-construction Bobai Judian Tungsten-Molybdenum Mine and the planned injection of the Dahutang Tungsten Mine are expected to significantly boost its long-term profits.

It is recommended to monitor China Tungsten And Hightech Materials Co.,Ltd.: Key focus areas include the production increase from the technical renovation of the Shizhuyuan company, and the potential injection of managed tungsten mines such as Xianglushan, Yaogangxian, and Xintianling.

It is recommended to monitor Jiaxin International Resources Inc.: Key focus is on the resource release from the Bakuta Tungsten Mine.

Risk Factors to Consider

Risks include new capacity construction falling short of expectations, tungsten price fluctuations exceeding expectations, market demand growth falling short of expectations, and market competition intensifying beyond expectations.