Tungsten Prices Break Through Key Levels: How Should the Drilling Tools Industry Respond to Rising Costs?

This week, China’s tungsten market continued its strong upward trend.

Market concerns over tight raw material supply are intensifying, confidence in stable rigid demand remains strong, and there is growing consensus on the increasing strategic value of tungsten resources. At the beginning of the week, major tungsten producers maintained firm long-term contract purchase prices, further driving bullish market expectations.

Although tungsten product prices are at historic highs, price transmission across the industrial chain is encountering resistance. Downstream end-users remain cautious in procurement, and actual transactions remain under pressure. However, according to industry feedback, towards year-end, some traders and end-users have begun to replenish inventories, improving activity in the spot market. Overall, the current tungsten market is characterized by a stark supply-demand imbalance: supply shortages will be difficult to fundamentally resolve in the short term, while demand exists but is being visibly suppressed by high prices. This has created a tug-of-war between buyers and sellers, leading to pricing disorder in the spot market, particularly a widening price spread on the powder side.

Prices Break Through Key Levels, Market Sentiment Continues to Heat Up

On Monday, tungsten powder prices broke through the critical benchmark of RMB 800,000 per ton. Today, tungsten carbide powder prices are approaching the same level, and the market is watching closely to see if a further breakout will occur this weekend or next week.

As of publication:

Tungsten powder: RMB 825/kg, up 3.8% W-o-W and 161.1% year-to-date.

Tungsten carbide powder: RMB 795/kg, up 3.9% W-o-W and 155.6% year-to-date.

Such a rapid and strong increase far exceeds previous industry expectations, indicating a compounded effect of resource scarcity and market capital expectations accelerating price growth.

Direct Impact of Rising Tungsten Prices on the Drilling Tools Industry

The sharp increase in tungsten powder and tungsten carbide powder prices directly pushes up the cost of cemented carbide, which is the core raw material in drilling tool production. As a result, the following products will face continued cost pressure:

DTH drill bits

Button bits

Chisel bits

Cross bits

Threaded drill bits (T38, T45, T51, etc.)

In particular, products with high proportions of carbide inserts—such as button bits and PDC-style cutting structures—will be more cost-sensitive and show faster pricing response.

QIDELI Perspective: Industry Impact and Response Strategies

As a company deeply rooted in drilling tool manufacturing, QIDELI believes this round of tungsten price increases is characterized by the following features:

01. Raw Material Shortage Is the Root Cause

High-quality tungsten resource concentration and domestic production control policies are tightening supply conditions, creating a structural shortage that cannot be resolved in the short term.

02. High Prices Affect Demand Rhythm, Not Fundamental Demand

Mining, infrastructure, and energy projects represent typical rigid demand sectors. Drilling tools remain irreplaceable consumables. Therefore, rising prices do not directly reduce demand but slow the procurement rhythm.

03. Cost Transmission Model Is Changing

Traditionally, pricing followed the chain: powder → material → bit → machine.
Currently, market sentiment is leading the trend, with manufacturers already bearing cost pressure at the procurement level, which will push product prices upward across the supply chain.

04. Enterprises Need to Actively Optimize Procurement and Inventory

In such a market environment, delaying procurement or pushing for lower prices often results in higher costs later.
Conversely, planned procurement and rolling small-batch stocking can improve the overall cost structure and enhance operational profitability.

QIDELI Recommendations for Customer Procurement Strategy

In a high-price cycle, we recommend:

Early price locking: Place key model orders in advance to secure controllable costs.

Small-batch stocking: Reduce single procurement pressure while maintaining stable supply.

Model optimization: Select more wear-resistant models for specific geological conditions to extend tool life.

Technical consultation: Optimize carbide grades, button configuration, and flushing angles based on rock hardness and application.

QIDELI can provide full technical selection support based on different mining conditions and operational environments, helping customers maintain drilling efficiency during periods of cost fluctuation.

Market Outlook: Upward Volatility Remains the Core Trend

In the short term, year-end financial conditions and pricing policies from major tungsten producers will influence market sentiment. However, from the perspective of supply fundamentals and growing resource value, prices still have upward potential. The industry has entered a “high-cost era,” which will test technology, production efficiency, and supply chain management across the sector.

As a drilling tool manufacturer, QIDELI will continue to monitor tungsten price trends and provide customers with transparent and reasonable pricing, along with reliable technical solutions—ensuring products are delivered with stable performance and strong cost competitiveness.