Tungsten Market $2b Boom by 2028
The tungsten metal industry is poised for a major boom over the coming 5 years with accelerating market growth expected at approximately $2 billion USD by 2028. This anticipated boom forecast by Technavio estimates to leave the value of this critical mineral market at close to $7 billion as we approach the end of the decade. The tungsten metals market was valued at $4.18 billion USD back in 2018 but by 2024, Technavio anticipates an impressive 5.69% Year-over-Year growth rate for metal.
1. What is Driving the Tungsten Metal Market’s Growth?
This significant growth in the tungsten market is being driven by the wide adoption of tungsten for use in integrated electrical circuits and an increasing demand for tungsten carbide in defence and automotive industries coupled with the vast tungsten ore reserves found in China.
2. Integrated Tungsten Electrical Circuits
As the demand for electrical goods continues to increase exponentially, tungsten metal is at the forefront of valued commodities for its importance in aspects of integrated electrical circuits such as heat reduction.
Did you know:
Modern computer processors produce comparable heat output to that of a kitchen hot plate per square centimeter.
A stable and effective form of heat reductive technology is required to ensure their effective and reliable operation. Tungsten is widely used in conjunction with copper and other alloyed materials to create effective heat sinks to help remove the heat produced inside the processors. An integrated circuit or microchip is a tiny fingernail-sized piece of pure silicon layered with circuits. All advanced microchips rely on tungsten plugs and vias contacts to connect layers of circuitry with the transistors.
3. Tungsten Carbide In the Automotive industry
Tungsten carbide is a dense alloyed compound produced by heating carbon black and tungsten in a hydrogen-rich environment. Renowned for its impressive durability, strength, performance, high melting point, corrosion resistance, and hardness, tungsten carbide proves a favourable choice amongst a variety of industries including the automotive and defense sectors.
According to PwC Autofacts, the potential for the automotive market in the US, Europe and China to rise by up to 30% by 2030. It is the significant market growth seen in the automotive sector which is largely helping to drive the subsequent growth of the tungsten market.
Did You Know:
High-performance automotive components that can tolerate extreme heat and strain, such as tyre studs, crankshafts, brakes, and ball joints, are made of tungsten carbide.
4. Tungsten Ore Reserves in China
According to Statista Research Department, China held a commanding lead of the global tungsten supply in 2022 with over 1.8 million metric tonnes of tungsten reserves. Vietnam and Russia came in second and third, with 400,000 and 100,000 metric tonnes, respectively, that year. An estimated 3.8 million metric tonnes of tungsten were present in the world's reserves as of 2022.
5. Tungsten Market Trends and Challenges
A number of trends in the tungsten metal market have also contributed to the forecast pricing of tungsten by 2028. These include the favoured miniaturisation of electronic components as ongoing modern innovation continues to make electronic goods and devices smaller and smaller. Another trend that is playing an increased role in tungsten’s pricing relates to tungsten producers and manufacturers utilising recycled tungsten scrap metal as a primary feedstock source and an alternative from traditional tungsten-based ores such as wolframite and scheelite.
As always, the environmental, safety and social regulations of tungsten mining and production will continue to play a key role in the pricing of this highly sought-after critical mineral. The potential for unethical and unregulated sourcing of raw material for tungsten production and the potentially dangerous impact of said production both for the workers and surrounding environment poses a significant challenge for the market to overcome as we move closer to the end of the decade.
Another key challenge for the pricing of tungsten metal relates to the recent economic slowdown of China’s huge growth seen in recent decades dropping by upwards of 4.5% growth each year down to 1% which was further exacerbated exiting out of the Covid era. Factors such as an aging population and reduced productivity are also contributing to to the threat of future Chinese growth prospects. Despite the large reserves of tungsten ore which China holds, a slowing economy will likely play a future role in tungsten outcomes based on the huge portion of manufacturing which China is accountable for.