Summary of Tungsten Industry Conference Call Industry Overview - The tungsten industry experienced a revenue growth of 10.3% and a profit increase of 5.9% in the first half of 2025, with mining companies showing outstanding performance, achieving revenue and profit growth of 29% and 43% respectively [2][3] - The smelting enterprises reported a low profit margin of 2.26%, while hard alloy profit margin was 5.67%, and tungsten products had a relatively better profit margin of 10.5% [2][3] Key Insights - The export of tungsten products, particularly APT and tungsten oxide, saw a significant decline of approximately 70% due to dual-use item regulations, while hard alloy exports slightly decreased by 1% [2][5] - On the import side, there was a notable increase of over 60% in ore imports, along with a rise in the import of recycled tungsten materials [5] - The price of tungsten surged in July and August 2025, primarily due to tight supply and demand dynamics, with ore prices exceeding 280,000 yuan per ton [6] - The consumption structure of tungsten indicates that 60% is used for hard alloys, with 50% of that for cutting tools, mainly in the manufacturing sector [2][7] Emerging Demand Areas - New growth areas for tungsten demand include nuclear fusion and military applications, which are expected to drive steady demand increases [2][7] - The nuclear fusion sector requires approximately 50-250 tons of tungsten per reactor, highlighting its critical role in advanced technologies [4][22] - High-purity tungsten target materials are anticipated to see increased demand in the AI and semiconductor sectors as technology matures [4][23][24] Challenges in Supply - European and American mines face environmental and cost pressures, with Australian mines potentially reducing output due to a shift to underground mining [8] - New tungsten mining projects in China are hindered by land use policies and environmental regulations, affecting construction timelines [9] Market Dynamics - The recycling of tungsten saw a significant increase in 2024, reaching 24,300 tons, but experienced a decline in the first half of 2025, indicating that previous potential has been largely exhausted [10][18] - The overall market growth in 2024 was significant, but the first half of 2025 saw a decline of approximately 18% compared to the previous year [19][20] Price Trends and Acceptance - The recent price increases have been met with varying levels of acceptance among downstream enterprises, with high-end products showing resilience while mid to low-end products face challenges [13] - Inventory levels among downstream companies are currently low, with some firms maintaining about a month's worth of raw materials [14] Future Outlook - The overall profitability of the tungsten industry is expected to improve in the coming months, contingent on successful price adjustments [16] - The supply tightness is projected to persist, providing support for future price stability [6][17]

Core Viewpoint - The A-share small metal industry experienced a collective rise on October 27, with tungsten-related companies leading the gains, driven by strong raw material prices and increased product pricing across the industry [1] Industry Summary - The leading company, Xiamen Tungsten, reached its daily limit up and set a new high, while other companies like Zhongtung High-tech and Zhangyuan Tungsten also saw significant increases of over 6% and 4%, respectively [1] - Tungsten market prices are on the rise, with the price of 65% black tungsten concentrate reported at 285,000 yuan per standard ton, up 99.3% since the beginning of the year; tungsten powder prices at 630 yuan per kilogram, up 99.4%; and tungsten carbide powder at 615 yuan per kilogram, up 97.8% [1] Market Dynamics - Despite the continuous rise in tungsten prices, downstream demand has not increased correspondingly, leading to weak market transactions at high price levels [1] - The short-term tungsten market is expected to be primarily driven by cost factors, with caution advised regarding potential price corrections and changes in downstream acceptance, as well as uncertainties in the international macroeconomic environment [1]

Group 1 - The core viewpoint of the article highlights the significant increase in tungsten prices in China since March 2025, with a notable surge in August, reaching a historical peak in early September [1] - As of early September 2025, the price of 65% black tungsten concentrate rose from 143,000 yuan per ton at the beginning of the year to a peak of 288,000 yuan per ton, before slightly retreating to 271,000 yuan per ton, marking an approximate increase of 89.5% year-to-date [1] - The article mentions that Jaxin International Resources (03858) has seen its stock price rise over 6%, attributed to the favorable market conditions for tungsten [1] Group 2 - Jaxin International Resources' core asset is the Bakuta tungsten mine, which is the largest open-pit tungsten mine globally, possessing the highest designed tungsten production capacity among single tungsten mines [1] - The Bakuta tungsten mine has a resource volume of 107.5 million tons of tungsten ore with a grade of 0.211%, containing 22.7 thousand tons of WO₃, and a reserve of 68.4 million tons of tungsten ore with a grade of 0.206%, containing 14.08 thousand tons of WO₃ [1] - The company is expected to benefit from the rising tungsten prices, leading to a potential rapid growth in profits as production increases in the future [1]

Group 1: Tungsten Price Trends - Tungsten prices have been rapidly increasing over the past three months, influenced by supply-demand dynamics and strategic importance in national security and industrial manufacturing [2][3] - Domestic tungsten concentrate supply is tightening, while overseas production is limited, leading to an expected sustained high price for tungsten [2] Group 2: Company Pricing Strategy - The company has raised prices for its tungsten carbide products three times this year, effectively covering all tool specifications, with high acceptance from customers [3] - Future focus will be on technological research and development to optimize product structure and increase the proportion of high-value-added products, thereby enhancing gross profit margins [3] Group 3: Production Capacity Enhancements - After the completion of technical upgrades, the Shizhu Garden tungsten mine is expected to increase its tungsten concentrate output by 2,000 tons per year, with fluorite production exceeding 500,000 tons per year [3] - The upgrades will also enhance the mechanization of open-pit mining, leading to larger production scales and potential cost reductions [3]

Core Insights - The tungsten market is experiencing a significant price surge, with prices for major tungsten products increasing by over 50% year-to-date, and some products seeing nearly 100% annual growth [5][16][18] - Upstream tungsten mining companies are adopting a "reluctant selling" strategy, controlling supply to maintain high prices, while downstream companies face rising costs and reduced profit margins [4][8][30] - The supply-demand imbalance is exacerbated by regulatory changes and increased demand from sectors like photovoltaics, leading to a tightening of available tungsten resources [10][21][67] Group 1: Market Dynamics - As of late September, the price of black tungsten concentrate has exceeded 270,000 yuan/ton, marking a 92% increase from the beginning of the year [16] - The price of ammonium paratungstate (APT) in Europe has surged to between 580 and 645 USD/ton, reflecting a year-on-year increase of over 30% [6][18] - Domestic tungsten exports have decreased by 34.56% from January to July 2025, while imports have surged by 45.57%, indicating a shift in the global tungsten trade landscape [20][44] Group 2: Upstream and Downstream Challenges - Upstream companies are experiencing record profits due to high tungsten prices, while midstream refining companies report a 60% increase in procurement costs for tungsten concentrate, with APT prices only rising by 25% [8][32] - The average price of black tungsten concentrate reached 272,000 yuan/ton in August, while APT prices remained around 400,000 yuan/ton, leading to compressed profit margins for midstream companies [33][36] - Downstream companies are facing cash flow issues, with extended payment terms from customers and increased procurement costs, forcing some to refuse long payment terms [39][54] Group 3: Regulatory and Technological Developments - Regulatory bodies are considering flexible mining quotas to balance supply and environmental concerns, but there are fears this could reduce resource tax revenues [11][12][65] - Technological advancements in tungsten recycling are being explored, with some companies achieving up to 85% recovery rates from tungsten waste, potentially alleviating some supply pressures [68][70] - The shift towards alternative materials in manufacturing is increasing, with some companies testing substitutes for tungsten-based products, which could further impact demand [50][56]

Group 1 - The core viewpoint of the article highlights that Jiexin International Resources (03858) has seen a significant increase in stock price, rising over 6% to 30.2 HKD, with a trading volume of 90.225 million HKD [1] - The tungsten market is experiencing a notable decrease in transaction volume due to high prices, which are slowly being transmitted to downstream industries, particularly affecting the hard alloy sector [1] - SMM indicates that the supply-demand mismatch in the tungsten market remains unresolved, suggesting that a significant price correction is unlikely, with a prevailing trend of strong fluctuations expected [1] Group 2 - Jiexin International is focused on tungsten mining in Kazakhstan, specifically developing the Bakuta tungsten mine, which is currently in production [1] - According to招商证券, the core asset of the company is the Bakuta tungsten mine, which is expected to see production increases in the future, benefiting from rising tungsten prices and potentially leading to rapid profit growth [1]

Group 1 - The core viewpoint of the article highlights that Jaxin International Resources (03858) has seen a significant increase in stock price, rising over 6% to 30.2 HKD, with a trading volume of 90.225 million HKD [1] - The tungsten market is experiencing a notable decrease in transaction volume due to high prices, which are affecting downstream industries, particularly the hard alloy sector, leading to reduced operational activity [1] - Despite the current market challenges, SMM believes that the supply-demand mismatch in the tungsten market remains unresolved, indicating that a significant price correction is unlikely, with expectations of continued strong fluctuations [1] Group 2 - Jaxin International is focused on developing the Bakuta tungsten mine in Kazakhstan, which is currently in production [1] - According to招商证券, the core asset of the company is the Bakuta tungsten mine, which is expected to see production increases in the future, benefiting from rising tungsten prices [1] - The company's profits are anticipated to grow rapidly as a result of the upward trend in tungsten prices [1]

Group 1 - The price of tungsten has surged significantly in 2025, with major tungsten products increasing by over 50% from their low points at the beginning of the year, and some products seeing nearly 100% annual growth [1][3] - As of September 9, 2025, tungsten prices reached historical highs, with tungsten concentrate at 287,500 CNY/ton, APT at 412,500 CNY/ton, tungsten powder at 635 CNY/kg, and 70 tungsten iron at 407,500 CNY/ton [1] - The market for tungsten is characterized by a supply shortage, with domestic mining operating at less than 35% capacity and a significant reduction in output due to environmental regulations [5][8] Group 2 - In the first half of 2025, the average price of 65% black tungsten concentrate was 150,000 CNY/ton, a 12.11% increase compared to the same period in 2024, while APT averaged 222,900 CNY/ton, up 12.23% year-on-year [2] - The Chinese tungsten consumption totaled 35,900 tons in the first half of 2025, a 2.1% increase year-on-year, with primary tungsten consumption at 30,400 tons, up 2.5% [3] Group 3 - The demand for tungsten is expected to grow due to trends in the photovoltaic sector, with tungsten wire penetration rates projected to rise from 20% to 60%, leading to a global demand exceeding 4,500 tons, a 198% year-on-year increase [4] - The aerospace and semiconductor industries are also driving demand for tungsten, with the hard alloy market in China expected to reach 41.5 billion CNY in 2025, growing by 7.8% [4][7] Group 4 - The current low inventory levels make the tungsten market sensitive to supply shortages, which could lead to significant price increases [8] - The strict mining quotas and the depletion of existing mines, along with the long lead times for new mines, make it difficult to increase tungsten supply significantly [8]

Core Viewpoint - The stock price of Jaxin International Resources (03858) has increased by over 9%, currently trading at 32.8 HKD, driven by rising tungsten prices and strong performance expectations from its core asset, the Bakuta tungsten mine [1] Company Summary - Jaxin International Resources focuses on tungsten resource development in Kazakhstan, with the Bakuta tungsten mine being its core asset [1] - As of the first half of this year, the Bakuta tungsten mine has a resource volume of 107.5 million tons of tungsten ore, with a grade of 0.211%, containing 22.7 thousand tons of WO₃ [1] - The mine's reserves are reported at 68.4 million tons of tungsten ore, with a grade of 0.206%, containing 14.08 thousand tons of WO₃ [1] Industry Summary - Tungsten prices have significantly increased, with major tungsten product prices doubling compared to the average price in 2024 [1] - As of September 3, the price of 65% black tungsten concentrate reached 278,000 CNY per standard ton, reflecting a 94.4% increase since the beginning of the year [1] - The rising tungsten prices are expected to lead to substantial profit growth for companies like Jaxin International Resources, which are positioned to benefit from this upward trend [1]

Summary of Tungsten Market Conference Call Industry Overview - The tungsten market is experiencing significant price increases due to various macroeconomic factors and supply-demand dynamics. [1][3][21] Key Points and Arguments Market Dynamics - **Price Trends**: Tungsten prices have surged to historical highs, with APT (Ammonium Paratungstate) prices expected to reach around 260,000 CNY per ton. [2][21] - **Supply and Demand**: The demand for tungsten is rising, particularly in high-tech applications such as missiles and solar energy. [3][4] - **Production Levels**: Tungsten ore production in the first half of the year remained stable compared to the previous year, with a slight decline in Jiangxi province. [9][10] Economic Influences - **US-China Trade Relations**: The recent extension of the tariff ceasefire indicates that export controls will remain in place, affecting price differentials between domestic and international markets. [5][6] - **Monetary Policy Effects**: The depreciation of the US dollar and the resulting capital outflow have influenced commodity prices, including tungsten. [3][5] Government Policies - **Domestic Economic Policies**: The Chinese government is implementing anti-involution policies to stimulate domestic demand, indirectly supporting tungsten prices. [4][7] - **Financial Measures**: Central bank initiatives to support consumer spending are expected to increase demand for industrial materials, including tungsten. [7] Production Challenges - **Environmental Regulations**: Increased environmental pressures have led to reduced production in key APT regions, impacting overall supply. [11][12] - **Raw Material Sourcing**: Companies are facing difficulties in securing raw materials, leading to increased production costs. [12][13] Market Risks - **Inventory Concerns**: Rapid price increases may lead to inventory accumulation across industries, posing risks to economic stability and employment. [8] - **Price Volatility**: The market is expected to undergo inventory digestion at high price levels, which could lead to fluctuations. [8][19] Future Outlook - **Supply Projections**: New tungsten mining projects are expected to have limited impact on supply until 2027, with domestic production anticipated to decline slightly. [26][31] - **Recycling and Recovery**: China's tungsten recycling rate is low compared to international standards, but there is potential for growth in this sector. [35][36] Strategic Resource Management - **Resource Control**: China is likely to enhance its management of strategic resources like tungsten and rare earths in the context of US-China relations. [6][5] Additional Important Insights - **Market Sentiment**: The psychological index indicates potential market rebounds when certain thresholds are crossed, providing insights into trading strategies. [15] - **Historical Context**: The tungsten market has experienced significant fluctuations over the past two decades, with current trends suggesting a potential for substantial price increases. [20][21] This summary encapsulates the key discussions and insights from the tungsten market conference call, highlighting the interplay of economic factors, government policies, and market dynamics that are shaping the future of the tungsten industry.