BMO: Tungsten Market Tighter Than Lithium 2021 With No Mine Pipeline to Fix It

By Ruixin Tungsten Carbide | March 26, 2026 | ruixintungstencarbide.com

The Heppel Assessment: Unprecedented Tightness

BMO Capital Markets VP of commodity research George Heppel said in March 2026 that he has never seen a tungsten carbide market as tight as the one that exists right now. The statement, reported by Streetwise Reports on March 23, carries weight because Heppel and his BMO colleague Helen Amos have been among the most closely followed analysts of the tungsten market through the 2025–2026 price surge.

Heppel’s assessment reflects what the data shows. APT European benchmark prices have reached USD 2,250 per metric ton unit — a 557% increase since China placed key tungsten products on its export control list in February 2025. Tungsten carbide powder inside China has risen 123.1% year-to-date alone, reaching RMB 2,320 per kilogram as of mid-March. Raw material inventories at most European and US producers are nearly depleted. Scrap prices jumped over 25% in a single week in mid-March. The industrial base, as Heppel put it, is desperate for material.

Lithium 2021 vs Tungsten 2026: The Same Story With a Different Ending

The lithium comparison is instructive. In 2021, lithium carbide prices surged dramatically as electric vehicle demand accelerated faster than supply could respond. Spot prices rose several hundred percent within 18 months. The comparison to tungsten in 2026 is apt on the demand side: both involved unexpected demand acceleration colliding with constrained supply, producing price spikes that seemed disconnected from historical norms.

But the lithium story had a resolution. The market corrected sharply in 2023 and 2024 as a wave of new projects — which had been in development for years before the spike — reached production. The lithium pipeline was deep. Australia, Chile, and Argentina had projects at various stages of development that could be accelerated when prices made it economically compelling to do so. Producers ramped. Prices fell.

Heppel explicitly identified the absence of this dynamic in tungsten. The metal does not have a backlog of mines ready to start producing. Projects being financed today — including American Tungsten’s CA$40 million raise and Allied Critical Metals’ Borralha development in Portugal — are 3–7 years from meaningful production. The Almonty Sangdong restart in South Korea is the single most advanced non-Chinese project, and its Phase 1 output is modest relative to the global supply gap.

The Pipeline Problem: Why Tungsten Cannot Self-Correct Quickly

The absence of a ready mine pipeline is not an accident. It reflects decades of low tungsten prices driven by Chinese supply subsidies, which made Western mine development economically unviable. The US has not mined tungsten commercially since 2015. Most European projects were mothballed in the 1990s and 2000s. The institutional knowledge, infrastructure, and permitting frameworks required to restart or develop tungsten mines in Western jurisdictions have atrophied.

Rebuilding that pipeline takes time that markets do not grant on request. Even in favorable jurisdictions with supportive governments, the path from exploration to production runs through resource definition, feasibility study, environmental permitting, financing, construction, and commissioning. Each stage has its own timeline. Compressed development — the kind that lithium achieved between 2021 and 2023 — requires projects that are already well advanced when the price signal arrives. Tungsten in 2026 does not have those projects. Fastmarkets noted that new mine developments in Europe, the US, and Asia remain years away from entering supply chains, regardless of price levels today.

BMO’s own analysis, published in February 2026 and widely cited since, outlined five potential mechanisms that could eventually rebalance the tungsten market. Meaningful expansion of Chinese mine supply is unlikely near-term due to grade challenges and environmental limits. Western project development will take years. Recycling cannot scale fast enough. Substitution is severely limited in high-performance applications. The only near-term mechanism with real force is demand destruction at high prices — which means industrial buyers cutting usage, downgrading specifications, or simply going without.

For a quotation-ready application review, use the mining and tunneling carbide tools.

Price Setting in an Illiquid Market

Almonty Industries CEO Lewis Black made a point that deserves attention from every procurement team buying carbide drill components. He noted that the tungsten market has never been in a situation where the market is determining the price. For decades, Chinese state subsidies and production policy kept tungsten prices artificially suppressed. The market never cleared freely. Now it does. And as Black said: we don’t really know where it is going to settle.

This is a critical observation for buyers accustomed to using historical price ranges as anchors for procurement decisions. The USD 300 per metric ton unit APT price that prevailed for years was not a market price — it was a managed price. The current USD 2,250 per metric ton unit reflects genuine supply-demand dynamics for the first time in a generation. There is no historical precedent for what freely priced tungsten looks like at sustained equilibrium. USD 2,250 may be the peak, or it may be a waypoint on the way to further highs. No one, including BMO’s most experienced analysts, can say with confidence.

CICC Forecast: 17% Supply Gap Through 2028

The structural case for sustained high prices is supported by institutional forecasting. CICC, cited in Meetyou Carbide’s March 2026 analysis, projects that the global tungsten supply-demand gap will account for over 17% of demand from 2026 through 2028. That is not a rounding error. It means the market will structurally under-supply demand for at least three years, absent a demand shock or an unexpected acceleration in supply development that has no current precedent.

Chengdu Fengke’s industry review similarly describes 2026 as the entry point into a high-tungsten-price era rather than a temporary spike. Multiple leading institutions predict that the supply-demand gap will persist and potentially intensify, with the industry remaining in a high-price operating state for the long term. The consensus is not optimistic for buyers hoping for a quick return to pre-2025 pricing.

What This Means for Carbide Drill Bit Buyers

The BMO framing has a direct implication for procurement strategy. If tungsten is tighter than lithium in 2021, but without lithium’s pipeline to provide relief, then the duration of the supply crisis will be longer than the lithium analogy suggests. The lithium correction took roughly two years. The tungsten correction, if CICC and BMO are right, will take at least three to five years — and possibly longer.

Buyers who are deferring supply agreements in anticipation of lower prices are making a bet that the most experienced market analysts are wrong. That is a procurement decision, not just a price decision. The cost of being wrong is not just a higher unit price — it is the inability to source material at any price, because sellers in a tightly constrained market can choose their counterparties.

Ruixin Tungsten Carbide manufactures coal cutter picks, shield machine teeth, ball teeth, DTH insert grades, and milling cutter bodies from facilities with pre-crisis upstream supply relationships. Contact Ruixin Tungsten Carbide to discuss current availability and pricing, or visit https://ruixintungstencarbide.com.

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Ruixin Carbide — Supplier Note

Based in Jinan, Shandong, our 14,200 m² cemented carbide facility produces over 500 metric tons of finished carbide annually. For applications discussed in this article, we typically supply a comprehensive range of cemented carbide grades for industrial applications—including YG8 grade material—to customers engaged in mining, construction, and heavy manufacturing sectors across global markets.

Recent shipments have gone to repeat customers in Australia, with standard delivery completed within 22–27 business days from order confirmation. Minimum order quantities begin at 100 kg for catalogue grades; smaller trial quantities are available for new customers evaluating material suitability.

To discuss grade specifications, dimensional tolerances, or volume pricing for your project, contact our technical sales team—we respond within one business day.