Tungsten Market The tungsten market entered FY2025 against a backdrop of tightening supply, intensifying geopolitical competition, and accelerating demand from both traditional and emerging industries. Over the course of the year, the global pricing environment strengthened markedly, with ammonium paratungstate (APT) prices rising from approximately US$330/mtu (≈A$500/mtu) at the start of the period to US$463/mtu (≈A$700/mtu) by June 2025 — representing a 37% increase year-onyear. This upward trajectory reflects both structural deficits in global supply and the heightened strategic importance of tungsten as a critical mineral. Geopolitics as a Price Catalyst Geopolitical factors were the dominant influence on tungsten market dynamics during the year. In February 2025, China imposed new export controls on tungsten and related rare metals, implementing a “one-item, one-certificate” licensing regime. This followed retaliatory tariffs introduced by the United States in late 2024, underscoring tungsten’s role as a strategic material with military and industrial applications. China also reduced its domestic mining quota by 6.5% starting in Q3 FY2025, further tightening global supply. At the same time, China doubled imports of Western tungsten raw materials in 2024, interpreted as a deliberate effort to build strategic stockpiles while disrupting supply security for Western consumers. The resulting imbalance is stark: while more than 90% of tungsten raw materials continue to originate from China and other opaque jurisdictions such as Russia, North Korea, and Central Africa, over 50% of global end-use demand is concentrated in Western economies (the U.S., EU, Japan, and South Korea). This mismatch has left critical industries — including automotive, aerospace, energy storage, defence, and semiconductors — exposed to increasingly politicised supply dynamics. Structural Tightness and Emerging Demand The supply-side contraction has been reinforced by resource depletion and rising environmental pressures. Average ore grades in China have fallen steadily, from 0.42% WO₃ in 2004 to around 0.28% in 2024, increasing costs and constraining new production. While non-Chinese projects such as Barruecopardo (Spain), Mt Carbine (Australia), and Sangdong (South Korea - not producing yet) have advanced, their combined output has yet to offset China’s reductions. EQ Resources Limited Annual Report 2025 11
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