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| China tungsten |
Middle East Conflict Drives Strategic Metal Demand
China tungsten prices surged to record highs as Middle East tensions escalated after US-Israeli strikes on Iran. Meanwhile, ammonium paratungstate (APT) offers jumped to ¥1.25–1.26mn/t, up sharply from ¥1.12–1.13mn/t last week. As a result, market participants anticipate prices may exceed ¥1.5mn/t shortly. This spike highlights tungsten’s strategic military importance, particularly for defense applications, which accounted for about 9% of global demand in 2024.
Freight Risks and Broader Metal Market Implications
Shipping disruptions through the Red Sea and near the Strait of Hormuz have increased freight costs sharply. At least three vessels sustained damage, delaying shipments. Consequently, titanium, vanadium, and copper markets also face higher logistical risks. In contrast, aluminium markets remain largely unaffected outside Iran, although supply disruptions could influence global prices if tensions persist. Therefore, traders monitor geopolitical developments closely to mitigate risk.
Long-Term Supply Security and Strategic Minerals
The conflict underscores the growing importance of secure supply chains for critical metals. Meanwhile, China’s tightened export controls on tungsten and rare earths exacerbate scarcity outside domestic markets. As a result, western governments and manufacturers are prioritizing strategic stockpiles and alternative sourcing. Furthermore, higher oil and energy prices could indirectly boost demand for molybdenum, titanium, and battery metals in the long term.
ScrapInsight Commentary
China tungsten’s record surge reflects geopolitical risk and strategic military demand. Freight disruptions and export controls intensify supply constraints. Investors and steel-alloy manufacturers should anticipate continued price volatility while reassessing supply-chain resilience.
