The heavy metal has a habit of becoming indispensable just as the world turns dangerous. It offers Europeans little cause for comfort.
There is a metal that has quietly tracked the probability of war for more than a century. It is not gold, not oil, not uranium. It is tungsten — dense, hard, with a melting point above 3,400 degrees Celsius, the highest of any metal. In peacetime, industry uses it mostly for drill bits and cutting tools. In wartime, it becomes irreplaceable. Armies need it for armour-piercing projectiles, cluster-munition pellets, and missile components. And right now, its price is screaming.
Ammonium paratungstate—the standard tradeable form of the metal—jumped from under $400 per metric ton unit in 2024 to over $2,200 in the first quarter of 2026. That is a more than fivefold rise in under two years. The market is telling those willing to listen something important.
It remembers every war
Bloomberg Opinion columnist David Fickling, who reported earlier this year from a Tasmanian tungsten mine reopening after three decades of dormancy, put it plainly in a recent podcast: “You can look at it as a bit like a sort of century-old missing prediction market for war, basically.” He explained the mechanism: mine operators talk to traders, traders talk to defence-material companies, and those companies place the first big orders when conflict looks real. Money follows the signal.
The history of that Tasmanian mine (the Dolphin Mine, on an island off the coast of Tasmania) reads like a précis of 20th-century conflict. It opened in 1917, during the First World War, and closed when the war ended. It reopened in 1938, before the Second World War began. Afterwards, it survived on Korean War demand, faltered when strategists concluded that high-technology warfare had made attritional conflict obsolete, and finally shut in 1990. It is now reopening.
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The physical reasons for tungsten’s military value are straightforward. Its density (at 19.25 grams per cubic centimetre, it is roughly the same as gold) concentrates kinetic energy. Its melting point means it holds its shape under extreme stress. As Mr Fickling described it: “If you’re trying to make an armour-piercing projectile to get through the armour plating of a tank, it’s going to hold its shape. Most materials are going to turn into a mushroom and dissipate their force. This is going to go straight through to the inside of the tank.”
In peacetime, over 80 per cent of tungsten goes into tungsten carbide. That means drill bits, cutting tools, and wear-resistant components used in automotive plants, mines, and oil wells. Turbine blades for jet engines and gas turbines used in data centres may contain up to 10 per cent tungsten by alloy composition. These are unglamorous applications. They explain why, during normal times, the metal attracts little attention and less investment.
China’s chokehold
The structural problem is severe. China produces approximately 80 per cent of the world’s mined tungsten concentrate and refines over 90 per cent of global ammonium paratungstate supply. North Korea and Russia account for a further five per cent. That leaves the rest of the world competing for roughly 15 per cent of annual output. It amounts to only around 85,000 metric tonnes in total.
China’s dominance is not the result of political manoeuvering alone. Its deposits are simply the best in the world. As Mr Fickling observed: “Going back to the turn of the 20th century, China dominated global tungsten supply. As soon as Chinese tungsten was able to get into the world market, their mines are the highest-grade mines and there is just more of it there.”
Beijing imposed export licence controls around the time US President Donald Trump returned to office in early 2025. Volumes fell approximately 40 per cent year-on-year through 2025 and into 2026. Mr Fickling described the market effect precisely: “If you’re dependent on Chinese tungsten exports, which every tungsten consumer is dependent on, you want to get your supplies early before those export controls result in the Chinese government saying, no, you can’t sell it to them.”
Strucutral fragility
Panic-buying amplified the price spike. A supply gap of at least 16,000 metric tonnes is forecast by 2030, even if all announced non-Chinese mining projects succeed on schedule.
Most materials are going to turn into a mushroom and dissipate their force. This is going to go straight through to the inside of the tank.
— David Fickling, Bloomberg
The market’s structural fragility compounds the problem. Unlike copper or oil, tungsten has no futures exchange, no forward curve, and no hedging mechanism. Mr Fickling identified this as a critical flaw: “There simply is no futures market in this because it’s such a tiny market most of the time.”
Investor Alex Turnbull told him the price could rationally sit anywhere between $300 and $3,300 per dry metric ton unit. Each figure is defensible, depending on whether China restricts supply. No bank will finance a mine on that basis. The Dolphin Mine’s entire equity stands at around seven million Australian dollars. Total investment over 20 years amounts to roughly $77m. In this context, that is less than peanuts; it is about what Amazon spends in approximately four hours.
Europe’s exposed flank
For the European Union, the implications are acute. The bloc imports approximately 80 per cent of its processed tungsten and around 21 per cent of its ore. China exceeds the Critical Raw Materials Act’s 65 per cent single-supplier threshold by a wide margin.
The EU’s machine-tool, automotive, aerospace, and defence sectors all depend on uninterrupted supply. None of them can easily substitute away from it. Unlike cobalt—where Chinese battery producers switched to lithium iron phosphate chemistry and reduced their exposure—tungsten’s combination of density and heat resistance has no practical equivalent in armour-piercing applications.
The Critical Raw Materials Act sets targets of 10 per cent domestic extraction, 40 per cent domestic processing, and 25 per cent recycling by 2030, with 60 strategic projects fast-tracked and penalties for firms that cannot demonstrate supply diversification by November 2026. Progress is real but slow. Meaningful relief from new European mines lies years away.
A strategic issue
In the interim, every cruise missile fired and every drone downed in active conflicts consumes tungsten that the EU cannot easily replace. The 2026 conflict over Iran alone pushed prices up a further 550 per cent in a matter of weeks. It is a demonstration of how wartime consumption overwhelms recycling capacity almost immediately.
Mr Fickling’s prescription is direct: governments must offer floor prices for a defined period long enough for miners to borrow against guaranteed revenue (say, three to five years). “The only economic supply of tungsten is in China,” he said. “So if that is a problem for you, you actually need a structure that’s going to encourage the supply outside China.” He cautioned against diluting such a scheme with common commodities: “What you actually want is a fairly small group of minerals where there is a real strategic issue. And I think tungsten is one.”
The only economic supply of tungsten is in China. If that is a problem for you, you actually need a structure that’s going to encourage the supply outside China.
— David Fickling
The EU has not yet adopted a floor-price mechanism for tungsten. The US has launched Project Vault, a $12bn critical-minerals reserve modelled on the Strategic Petroleum Reserve, but its inclusion criteria remain unclear and its scope risks being captured by lobbying from producers of far more abundant materials. Europe, which faces the sharper exposure given its proximity to active conflict and its dependence on NATO re-armament, has no equivalent instrument at all.
A lifeline? Maybe
The Dolphin Mine, if it reaches full production, could supply approximately 2.5 per cent of the global market — a figure that sounds modest until one notes that it represents roughly 16 per cent of what Mr Fickling calls “the free world market”, once Chinese, Russian, and North Korean output is excluded. For those who have spent three decades assuming that commodity markets would always clear, that 16 per cent looks less like a rounding error and more like a lifeline.
Tungsten has been here before. It opened mines in 1917 and 1938. The overall pattern is not comforting.
