SHANGHAI Chinas tungsten ore output will continue to rise in 2013, putting downward pressure on the price of the raw material, according to Jiangxi Rare Metals Tungsten Holding Group Co. Ltd. (JXTC)s deputy chief economist.
"Tungsten concentrate output will increase by at least 5 to 10 percent this year," Zhu Xiusheng told AMM sister publication Metal Bulletin. "Prices will not be strong."
"Production costs for tungsten concentrate are at about 80,000 yuan ($12,737) per tonne, so miners are enthusiastic about producing," Zhu added. The most recent market price was about 117,000 to 119,000 yuan.
In addition, new mines are scheduled to come online in Hunan, Jiangxi and Yunnan this year, further contributing to the oversupply, Zhu added.
And even as supply is growing, demand is faltering. Chinas tungsten product exports fell to their lowest level in eight years in January and February, Zhu noted, saying that overseas demand has "shrunk."
Production of tungsten concentrate with 65-percent metal content reached 131,141 tonnes last year, up 13 percent from 2011, according to Chinas National Bureau of Statistics.
A version of this article was first published by AMM sister publication Metal Bulletin.