Xiamen Tungsten Co. Ltd. amid a Sudden Surge in Tungsten Prices
Xiamen Tungsten Co. Ltd. (600549.SH), a Shanghai‑listed producer of tungsten compounds and alloys, is navigating a rapidly changing market landscape that has seen tungsten prices leap into a new “jump‑price” regime. The company’s share price, which traded at 59.5 CNY on 12 February 2026, sits roughly 16 % below its 52‑week high of 69.2 CNY and 7 % above its 52‑week low of 17.53 CNY. With a market capitalisation of approximately 94 billion CNY and a price‑earnings ratio of 41, investors are keen to understand how the recent price dynamics will affect Xiamen Tungsten’s earnings and strategic positioning.
1. Supply Constraints and Price Momentum
On 14 February, two independent news outlets reported that the supply of tungsten ore and refined products has contracted sharply, while spot‑market liquidity has fallen. The tightening of the upstream supply chain, coupled with aggressive enforcement against illegal mining and excessive ore extraction, has led to a steep rise in tungsten prices. Analysts note that the daily price jump—from “a few thousand yuan a day in past years” to “tens of thousands of yuan today”—has shocked market participants.
The price escalation is not limited to raw ore. The spot market for refined tungsten products—ammonium paratungstate, blue and yellow tungsten oxides, tungsten powder, and tungsten alloy—has also seen accelerated price increases. Xiamen Tungsten, which processes these materials, has been one of the few firms able to maintain production capacity while navigating the tighter supply environment. The company’s management has released several price‑adjustment notices during the year, aligning its sales pricing with the new market reality.
2. Downstream Impact and Contractual Concerns
The rapid price rise has reverberated through the downstream supply chain. Many users of tungsten, such as manufacturers of hard‑metal tools and high‑performance alloys, face “contractual trust crises” and “no‑grain‑in‑the‑pan” situations, as quoted by a chain‑industry insider. These difficulties arise because buyers cannot afford the sudden cost spikes, leading to payment delays and, in some cases, breach of contract. As a result, some downstream companies have temporarily halted procurement of tungsten, creating a potential shortfall in Xiamen Tungsten’s sales volume.
Despite these pressures, Xiamen Tungsten has continued to raise its selling prices. The firm’s latest price‑adjustment notice, published on 14 February, reflects the need to protect margins in a volatile market. The company’s strategic focus on both refining and battery production—where tungsten is an essential component of some cathode materials—positions it to benefit from the rising demand for high‑performance batteries in China’s electrification push.
3. Market Context and Investor Sentiment
The broader market reaction to tungsten’s price surge has been mixed. While the industry’s headline, the “jump‑price” trend, has drawn attention, the overall A‑share market on 13 February experienced a decline of more than 1 % across its three main indices. In particular, the non‑ferrous metals sector—of which tungsten is a key component—fell by 3.36 % as investors reacted to the out‑of‑line price movement. The sector’s net outflow of 143.75 billion CNY in active funds on that day further underscores the uncertainty surrounding commodity‑heavy industries.
Nevertheless, Xiamen Tungsten’s share performance has shown resilience. The company’s stock fell only 2.86 % on 13 February, a relatively modest dip compared to its peers in the sector. This stability suggests that market participants recognise the firm’s capacity to navigate supply shocks and maintain pricing power.
4. Strategic Moves: Mergers and Acquisitions
In the same week that the tungsten price escalation made headlines, Xiamen Tungsten was listed among 17 A‑share companies reporting progress on merger and re‑organisation activities. The company’s inclusion in this list—together with other industry names such as “Hainan Mining” and “Xiamen Airport”—indicates that it may be exploring strategic consolidation to strengthen its resource base and production capabilities.
While the details of any potential deal remain undisclosed, the broader trend of increased M&A activity in China’s resource sectors—driven by policy incentives under the “Mergers Six‑Line” framework—suggests that Xiamen Tungsten could be positioning itself to secure more stable ore supplies or to expand its downstream battery business through complementary acquisitions.
5. Forward Outlook
The combination of a tightening supply environment, rising tungsten prices, and ongoing strategic consolidation points to a complex but potentially lucrative period for Xiamen Tungsten. The firm’s diversified product mix—spanning tungsten oxides, powders, and alloys—provides a buffer against volatility in any single segment. Its involvement in battery production aligns it with the growth trajectory of China’s electric vehicle and renewable energy markets.
However, investors should remain mindful of several risks:
| Risk | Impact |
|---|---|
| Continued supply bottlenecks | Higher input costs, margin squeeze |
| Downstream price sensitivity | Potential demand contraction |
| Contractual disputes | Cash‑flow disruptions |
| M&A integration challenges | Operational inefficiencies |
In sum, Xiamen Tungsten’s current trajectory reflects a company that is actively responding to a volatile commodity market, leveraging its processing capabilities, and considering strategic moves to secure long‑term competitiveness. As tungsten prices continue to evolve, the firm’s ability to translate price gains into sustainable earnings will be a key determinant of its future performance.
