China has cultivated an overwhelming dominance across the entire tungsten supply chain, encompassing mining, processing, and export. This pervasive control positions China as the undisputed leader in the global tungsten market. In terms of mine output, China consistently accounts for the vast majority of global raw tungsten ore production. In 2023, China's mine production was estimated at 63,000 metric tons, out of a world total of 78,000 metric tons, representing approximately 80.7% of global output. Other reports corroborate this, citing China's share as "over 80%" or even "an extraordinary 82.7% in 2023" and "~81%". This level of production far outstrips any other nation, with Vietnam and Russia following distantly at approximately 4% and 2-3% respectively in 2023.
China also holds the largest tungsten resources and reserves globally. In 2023, its estimated reserves stood at 2,300,000 metric tons, out of a world total of 4,400,000 metric tons, equating to approximately 52% of known global reserves. While other countries like Russia, Canada, and the United States possess significant resources, China's proven reserves and active mining operations solidify its foundational control over the raw material.
Beyond raw material extraction, China controls a substantial portion of the world's tungsten refining process, making it "indispensable to industries worldwide". This processing capability is a critical bottleneck; even when tungsten ore is mined outside China, "much of it is still sent to China for processing due to limited refining capacity elsewhere". This means that simply diversifying mining operations will not fully resolve global supply chain vulnerabilities; developing independent processing capacity outside China is equally vital.
China's dominant production translates directly into its leading role in global tungsten exports. While the United States is not the largest direct recipient of China's raw tungsten exports, having imported 27% of its tungsten (ores, concentrates, and other forms) from China between 2019-2022, Japan and South Korea are particularly significant importers of Chinese tungsten. These countries often process the Chinese-sourced materials into tungsten-related products that are then supplied to the United States and other global markets, creating an indirect but critical reliance.
Effective February 4, 2025, China introduced new export controls on tungsten, alongside other critical metals like tellurium, bismuth, and indium. These measures are not outright bans but require special export permits/licenses from the Ministry of Commerce and General Administration of Customs. This new regime replaces previous annual quota management with individual company and target country applications, creating significant bureaucratic hurdles.
China's stated motivations for these restrictions include safeguarding national security and interests, resource conservation, and industrial upgrading implying a desire to ensure domestic industries have priority access to these strategic materials. However, the timing aligns with broader geopolitical tensions, suggesting an element of leverage in economic and strategic rivalries.
The immediate global impact has been significant, with the international market "thrown into disarray." Major importers such as the U.S., EU, Japan, and South Korea, heavily reliant on Chinese supply, face severe procurement challenges. While the U.S. is not a primary direct importer of Chinese tungsten, its industries are indirectly affected as key allies like Japan and South Korea process Chinese tungsten into components vital for American manufacturing and defense sectors.
Disruption risks are particularly acute for manufacturing sectors producing cutting tools and for defense industries, which rely on tungsten for armor-piercing munitions and critical components. Companies report scrambling for alternative supplies and rationing existing inventory, leading to emerging shortages.
Consequently, tungsten prices have surged. Ammonium paratungstate (APT) prices, a benchmark, increased over 20% in months. European tungsten iron saw a 17.6% increase, and European APT jumped over 40% from the beginning of the year as of June 27, 2025, demonstrating immediate market volatility and higher costs for end-users.
Governments and industries worldwide are stepping up their efforts to diversify supply chains, enhance domestic processing, and improve recycling capabilities. One significant focus is the diversification of supply sources. New mining projects are being accelerated outside of China, with notable developments such as the Sangdong mine in South Korea, the Mactung Project in Canada, the IMA Mine in the United States, and the Dolphin Mine in Australia. In response to these initiatives, various governments, including the U.S. Department of Defense, are investing in these projects to mitigate risks associated with supply shortages.
In addition to diversifying supply, there is a growing emphasis on recycling and secondary metallurgy. The tungsten-based materials recycling market is becoming increasingly important, with companies like Quest Alloys & Metals playing crucial roles in recovering different forms of tungsten scrap. This growing focus on recycling not only offers a sustainable and independent source of materials but also helps reduce reliance on primary extraction, making it a vital component of the supply chain.
Furthermore, policy responses have been significant, as tungsten is recognized as a critical mineral by countries such as the United States, European Union member states, Australia, and Japan. To bolster supply security, governments are enacting critical minerals legislation, exploring import licensing for sources outside of China, and reassessing their strategic stockpiling initiatives. The U.S. Department of Defense, for instance, maintains a National Defense Stockpile, yet there are ongoing concerns about its sufficiency and the historical over-reliance on single vendors.
The tungsten restrictions reflect a trend seen in China's past export controls on other critical minerals, such as rare earths in 2010 and again in late 2024 to early 2025, as well as gallium and germanium in July 2023. In each of these cases, China maintained a near-monopolistic grip on the production or processing of these essential materials. The strategic importance of these minerals cannot be overstated, as they are crucial for high-tech industries and defense applications. China has leveraged export controls as a policy tool to enhance national security, safeguard resources, and exert geopolitical influence over Western policies. The immediate effects of these restrictions have been significant, resulting in supply chain disruptions, skyrocketing prices, and a global race to find alternative sources and build domestic capacities..
Manufacturers should prioritize diversifying their procurement channels by exploring long-term contracts with suppliers outside of China. Investing in research on material substitution is also advisable where it is feasible, alongside optimizing internal processes for scrap recovery. Such strategies will help mitigate risks associated with dependence on a singular source.
For investors, there are numerous opportunities arising from new mining projects beyond China, advancements in refining technologies, and the growing sector of tungsten recycling. Companies like Quest Alloys & Metals, which specialize in secondary metallurgy, present critical investment prospects as they navigate this evolving market.
Meanwhile, governments must focus on enacting critical minerals legislation, expanding their strategic stockpiles, and establishing robust domestic processing capabilities. It is essential for them to forge strategic partnerships and bilateral agreements with resource-rich nations to secure more diversified supply chains. Moreover, promoting research and development in new materials and recycling technologies will be vital in strengthening this sector.
In this rapidly changing environment, global stakeholders need to prepare for a future where critical mineral supply chains become increasingly fragmented and politicized. To ensure long-term supply-chain resilience and national security, proactive measures to build redundancy, foster innovation, and secure diverse material sources are fundamental.
Quest Metals stands out as a significant player in this landscape, providing innovative solutions for tungsten and hardmetal scrap recovery. Their dedication to sustainable secondary sourcing positions them as a reliable and strategic partner for industries and governments aiming to navigate the future of critical minerals effectively.