High Concentration of tungsten reserves

China tungsten reserves account for 65% of the world, China MINMETALS tungsten reserves accounted for about 75% of China. According to the U.S. Geological Survey data, by proven reserves of mineral resources in the world, China tungsten reserves account for 65% of the world.however 90% of Chinese tungsten ore resources concentrate in Jiangxi, Hunan, Henan, Fujian provinces. From the company perspective, 75% of tungsten resources are accounted by China MINMETALS holding or holding subsidiaries.

High concentration of tungsten production

High concentration of tungsten production, China tungsten production accounted for 85% of the world, China MINMETALS accounted for about 60% of total production. But there still have room to improve for China's tungsten concentrate production control there. from 2002 to 2010, China's total control of tungsten mining index rose slightly, compound growth rate is 7.8%. However, the actual tungsten concentrate production in 2010 exceeded the target by 50%.

China tightened export controls

China tightened export controls, and China MINMETALS accounted for nearly 80% of export quotas. tungsten export quotas is declining and export tax rate is increasing, tungsten export direction will transfer to high value-added products.

China MINMETALS have the rights to control the tungsten price

China MINMETALS have the rights to control the tungsten price. Tungsten pricing model is: Ganzhou Tungsten Industry Association and Jiangxi Tungsten Group, China MINMETALS and Hunan Nonferrous will communicate in 5th each month then they will announce guiding price of tungsten (tungsten concentrate, APT, tungsten powder). The price become a market benchmark, and have a large influence on the market. As Jiangxi Tungsten Group, Hunan Nonferrous Metals is a subsidiary of China MINMETALS, so the pricing on the China MINMETALS has a strong voice.

High cost of tungsten concentrate

High cost of tungsten concentrate, according to Secretary-General of Ganzhou Tungsten Industry Association it is estimated that the tungsten concentrate cost is 135,000 yuan / ton. including seven aspects - geological exploration of resource costs, the cost of mine construction, mining costs, processing costs, employee wages, environmental costs, management costs. Investors can be adjusted according to specific circumstances.

According to several considerations such as the Chinese production and export policies, the cost of production, supply and demand gap, we believe that despite the global economic downturn, it has led to a big influence on recent transactions, price pressure, but we believe that the steadily trend of tungsten prices rise will not change.