(Kitco News) - Almonty Industries CEO Lewis Black cautioned about the vulnerabilities in the global tungsten supply chain, spotlighting China's recent export restrictions and their potential impact on Western consumers.
In a Kitco Mining interview, Black discussed the increasing importance of tungsten, a metal vital to various sectors, from technology to defense. "Tungsten is in every sector," Black stated, emphasizing its use in everything from aerospace and automotive to semiconductors and screens.
Concentrated supply
Black highlighted the concentration of tungsten production, with approximately 90% controlled by China, Russia, and North Korea. This reliance poses a strategic risk, especially given geopolitical tensions.
"You find yourself in a conflict where they sit on one side. And you sit on the other, and from a purely common sense, that may not be a fantastic strategy to depend on your munition products from the three entities you may face off against," said Black.
The situation intensified when China announced export restrictions on several critical products, including tungsten. Black suggested this move could aim to starve Western consumers, hindering their ability to produce downstream products. "If the consumer can't buy the raw materials, he can't produce the downstream products," Black explained.
Almonty's solution
Almonty Industries is positioning itself to address the supply imbalance. The company is set to open the world's largest tungsten mine in South Korea, with plans to supply a significant portion of Western demand.
"We seem to be doing what we're doing right at the right time…from an independence, a diversification sense," Black noted.
The initial phase of the Korean operation is projected to produce 2,500 tons per year, with an expansion to nearly 5,000 tons planned shortly after. Black estimates that Almonty's mines could cover 10 to 12 percent of global supply and 30 to 35 percent of non-Chinese supply.
Strategic Shift to the U.S.
Almonty is also moving its domicile from Canada to the U.S., a strategic decision to align with its customer base and capitalize on opportunities in the American market. "To be ring-fenced and protected as an American corporation brings us affords us," Black stated.
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