APT price outlook

In June 2018, APT prices hit a four-year high of US$350 per metric tonne unit as a result of Chinese smelters coming offline. These prices were not seen since September 2014 when the Fanya Metal Exchange was still active.

 “Fanya is widely believed to have contributed to the last tungsten price spike in 2012-2014, as a result of APT purchasing that ultimately led to the accumulation of large stocks – and during which time tungsten prices largely detached from macroeconomic trends,” Roskill stated.

 Following restarts in China, the price trended lower for the remainder of 2018 before hitting US$275/mtu in January 2019.

 Over the last few months, the APT price has stabilised and is currently in the range of US$265-290/mtu with some market analysts forecasting a price at around US$275-300/mtu in the near future.

 Although based on demand and production base cases, Northland has forecast the APT price rising to US$350/mtu in 2019 and then continuing to reach US$445/mtu by 2023.

 Ms Roberts said some factors that could drive the tungsten price higher in 2019 include how quickly new mine projects at La Parilla and Barruecopardo in Spain can ramp up and whether any of the APT stocks in Fanya are released to the market during the year.

 In addition, a potential resolution to trade discussions between China and the US in the coming months could impact prices going forward.

 “Assuming the new mines in Spain come online as planned and there is a positive outcome between China and the US, we would expect to see a slight increase in the APT price towards the end of Q2 and into Q3, before a decrease again in Q4 as seasonal factors come into play,” Ms Roberts said.