Why Have Tungsten Carbide and Cobalt Powders Surged in Price This Year?

Since 2025, tungsten carbide and cobalt powder—core raw materials for the cemented carbide industry—have experienced a sharp price surge. Wolframite concentrate prices have risen by over 118% year-to-date, while cobalt powder prices have skyrocketed by 40% in a short period. This has directly pushed up the production costs of downstream cemented carbide products, significantly impacting manufacturing and procurement across the global industry. The price surge is not driven by a single factor but by the combined effect of supply-side contraction, demand-side expansion, policy regulations, and geopolitical tensions. This article uses plain language and intuitive charts to break down the core reasons behind the price increase, helping global industry practitioners gain a clear understanding of market dynamics and providing references for production planning and procurement decisions.

1. Core Reason 1: Sustained Supply-Side Contraction, Tight Raw Material Supply

Rigid contraction on the supply side is the primary driver of this price surge. Both wolframite concentrate (the core raw material for tungsten carbide) and cobalt ore (the main source of cobalt powder) are facing global supply constraints.

1.1 Tungsten Resource Supply: Policy Controls + Stricter Environmental Standards, Sustained Capacity Cuts

As the world’s dominant tungsten supplier (accounting for over 80% of global output), policy adjustments in major tungsten-producing countries directly shape the global tungsten resource landscape:

• Reduced Mining Quotas: In 2025, the first batch of global tungsten concentrate mining quotas decreased by 6.5% year-on-year to 58,000 tons, with quotas in key producing regions falling by more than 10%. This directly limits the output of primary tungsten ore;
• Stricter Environmental Policies: International and regional environmental standards such as the "Tungsten Industry Specification Conditions (2023 Edition)" have raised requirements for energy consumption and emissions in mining operations. Small and medium-sized mines, unable to meet these standards, have seen their global average operating rate drop to 35%, further reducing market supply;
• Declining Ore Grade: The global proven reserve life of tungsten ore is less than 15 years. The grade of ore in existing mines is decreasing year by year, increasing mining and beneficiation costs. Some enterprises have voluntarily reduced production due to profit pressures.

Additionally, new overseas tungsten mining capacity is limited. Projects such as Australia’s Bacuta Tungsten Mine are not expected to start production until 2026, with an initial capacity of only 2,000 tons per year—insufficient to alleviate the global supply gap in the short term.

1.2 Cobalt Resource Supply: Export Quotas + Geopolitical Conflicts, Widening Global Supply Gap

Cobalt supply is highly dependent on the Democratic Republic of the Congo (DRC), which accounts for over 70% of global cobalt production. Policy adjustments and unrest in the DRC have directly triggered a global supply crisis:

• Tightened Export Policies: After lifting a 7-month cobalt export ban, the DRC implemented a strict export quota system. The 2025 annual quota is only 52,000 tons, a 56% decrease from 2024 exports. Global cobalt demand is expected to reach 260,000 tons, resulting in a gap of approximately 30,000 tons;
• Impact of Geopolitical Conflicts: Escalating conflicts involving rebel groups in eastern DRC have disrupted supply chains in key mining regions such as North Kivu Province. Some mines have been forced to suspend operations, and actual exports may fall below the quota level;
• Limited New Supply: New cobalt mining capacity in Indonesia, Russia, and other countries totals only about 70,000 tons, insufficient to fill the supply gap left by the DRC. Moreover, transoceanic shipping times of 2-3 months have further exacerbated short-term supply tightness.

Comparison Table of Core Supply-Side Constraints

2. Core Reason 2: Sustained Demand-Side Expansion, Strong Market Demand

Amid supply contraction, booming growth in downstream global industries has driven continuous demand growth for tungsten carbide and cobalt powder, creating a "supply-demand imbalance" in the market.

2.1 Demand from the Cemented Carbide Industry: Dual Growth in Output and Exports

As the largest consumer of tungsten carbide and cobalt powder, the global cemented carbide industry has seen steady demand growth:

• In 2025, global cemented carbide output exceeded 260,000 tons, with a market size of 85 billion US dollars. Consumption of raw materials continues to increase;
• International trade has performed strongly. In 2025, global cemented carbide exports reached 70,000 tons, growing for five consecutive years. Major export destinations include Southeast Asia, Europe, and North America, with the proportion of high-value-added cutting tools and precision components rising steadily;
• Demand remains stable in traditional sectors (cutting tools, mining tools), while emerging fields (new energy equipment, semiconductor manufacturing equipment) have become new growth engines, further expanding raw material demand.

2.2 Demand from the New Energy Industry: Explosive Growth in Cobalt Powder Demand

As a key raw material for lithium-ion batteries, cobalt powder has experienced explosive demand growth driven by the rapid development of the global new energy vehicle (NEV) industry:

• Global NEV production continues to rise, driving rigid demand for cobalt in nickel-cobalt-manganese (NCM) lithium-ion batteries. Although low-cobalt battery technology is advancing, reliance on primary cobalt remains unchanged in the short term;
• The lithium-ion battery industry in major NEV-producing regions (Asia, Europe, and North America) continues to expand, with procurement demand for cobalt powder directly driving up cobalt raw material prices.

3. Other Contributing Factors: Cost Pass-Through and Market Expectations

Beyond the core supply-demand imbalance, the following factors have further amplified the magnitude of the price surge:

3.1 Rising Production Costs, Driving Price Pass-Through

• Labor and energy costs in global tungsten and cobalt mining and beneficiation have increased year by year. Combined with higher environmental investment, this has directly pushed up raw material production costs;
• Tungsten carbide powder and cobalt powder account for over 70% of cemented carbide production costs. Price increases in upstream raw materials are quickly transmitted through the industrial chain, ultimately reflected in terminal raw material prices.

3.2 Impact of Geopolitics and Trade Policies

• Major economies such as the EU and the United States have classified tungsten and cobalt as "strategic critical minerals," intensifying global competition for strategic minerals and fueling price hike expectations;
• International trade policies such as the EU’s Carbon Border Adjustment Mechanism (CBAM) have increased export costs for mineral resources and products. Some enterprises have adjusted their supply chain layouts, further exacerbating short-term market supply-demand imbalances.

3.3 Market Expectations and Inventory Behavior

• Tight supply has led to a "reluctance to sell" mentality among global industry enterprises. Some producers and traders have actively increased inventories, reducing market circulation and further pushing up prices;
• To avoid the risk of future price increases, downstream enterprises have stocked up in advance, forming a cycle of "rising prices → increased purchasing → further price increases," which has amplified demand-side pressure in the short term.

4. 2025 Price Trend Overview of Tungsten Carbide and Cobalt Powder

Note: Data is compiled from industry reports and global market monitoring. Prices are mainstream global quotes for reference only.

5. Conclusion and Industry Insights

The 2025 price surge of tungsten carbide and cobalt powder is essentially the concentrated eruption of long-term contradictions between "rigid supply-side contraction" and "steady demand-side expansion," exacerbated by external factors such as global policy regulations and geopolitical tensions. For global tungsten carbide industry practitioners, this price surge presents both challenges and opportunities:

• In the short term, rationalize procurement cycles and lock in raw material costs through long-term agreements, futures hedging, and other methods to reduce price volatility risks;
• In the long term, focus on diversified supply chain layouts (e.g., developing new producing regions such as Indonesia and Australia) and increase the recycling and reuse of scrap tungsten and recycled cobalt to reduce reliance on primary ores;
• When communicating with global downstream customers, clearly explain the objectivity of price increases using the core reasons mentioned in this article, and work together to address market changes.

In the future, as new overseas production capacity comes online, low-cobalt technology advances, and the utilization rate of recycled resources improves, the price surge may gradually ease. However, against the backdrop of stricter global control over strategic mineral resources and sustained growth in high-end manufacturing demand, the price floor for tungsten carbide and cobalt powder is likely to remain at a high level. It is recommended that global industry enterprises continuously monitor supply-demand changes and policy dynamics, and flexibly adjust production and operation strategies to adapt to long-term market development. If you need specific raw material procurement strategies or market trend forecasts, please contact us for customized analysis reports.