Overview of The Tungsten Market Is Warning of an Upcoming War
This Odd Lots episode explores why tungsten — a niche but strategically important metal — is suddenly attracting attention again. Hosts Joe Weisenthal and Tracy Alloway speak with Bloomberg Opinion columnist David Fickling about the reopening of an Australian tungsten mine, the metal’s long history of boom-bust cycles tied to war, and why today’s geopolitical environment is making tungsten look like a leading indicator for future conflict.
Key Takeaways
- Tungsten is a “sometimes essential” commodity: It matters much more during periods of war, rearmament, and high geopolitical tension than in normal peacetime.
- The market is heavily dominated by China: China controls roughly 80% of global tungsten supply, making the rest of the world highly exposed to Chinese export controls or policy shifts.
- A new Australian mine is reopening for strategic reasons: The Dolphin Mine in Tasmania is restarting after years of dormancy, partly because investors see rising strategic demand and supply-chain risk.
- Tungsten is still mostly an industrial metal: Around 80% of demand is for tungsten carbide used in tools, drilling, and machining — not just weapons.
- The market is too small and opaque for normal finance: There’s no meaningful futures market for tungsten, which makes it hard to hedge, hard to bank, and hard to fund new mining projects.
Why Tungsten Matters
Military Uses
Tungsten’s value rises sharply in wartime because of its physical properties:
- Extremely dense
- Very high melting point — over 3,000°C
- Retains shape under extreme heat and force
That makes it useful for:
- Armor-piercing projectiles
- Shrapnel and cluster munitions
- Drone and missile components
- High-temperature defense applications
The episode emphasizes that tungsten is not just a raw material — it is a war-enabling metal.
Civilian and Industrial Uses
Most tungsten demand comes from non-military uses, especially:
- Tungsten carbide tools
- Drill bits
- Mining equipment
- Oil and gas drilling
- Turbine blades
- Some industrial catalysts
- Small quantities in certain semiconductor and AI-related processes
In other words, tungsten sits at the intersection of heavy industry, defense, and advanced manufacturing.
Why the Market Is So Hard to Finance
David Fickling explains that tungsten is a difficult commodity to invest in because:
- The global market is small — about 85,000 metric tons per year
- Prices can swing wildly depending on Chinese policy and geopolitical tension
- There is no robust futures market like there is for copper or oil
- Most tungsten supply is already mature and heavily recycled
Pricing Problem
The conversation clarifies a confusing but important detail:
- Tungsten is often quoted in dry metric ton units (dmtu) via ammonium paratungstate pricing
- One dmtu contains about 7.93 kg of tungsten
- A price of $3,000 per dmtu translates to roughly $400,000 per ton of tungsten
That makes the metal far more valuable than the shorthand price quote suggests.
The Australian Mine and What It Signals
The reopened mine in Tasmania is presented as a case study in strategic resource thinking:
- It has a long history of opening during wars and closing when wars end
- It first opened during World War I
- It reopened ahead of World War II
- It was helped along by the Korean War and later Cold War demand
- It shut down in the 1990s and now is returning amid renewed geopolitical stress
The mine is also notable for its unusual shareholder base — a mix of:
- commodity traders
- industrial equipment dealers
- distressed asset investors
- state-backed interests
- former industry insiders
Its significance is outsized relative to its cost: a relatively small amount of capital could supply a meaningful share of the non-Chinese tungsten market.
Geopolitical Implications
The discussion centers on a broader question: Should the West subsidize strategic mineral production even when it is uneconomic on paper?
The Case for Intervention
Fickling argues that for minerals like tungsten, rare earths, gallium, and germanium, governments may need to:
- Offer floor prices
- Provide multi-year price guarantees
- Backstop private financing
- Treat supply security as a strategic objective, not just a market one
The Risk of Doing Nothing
Without policy support:
- new mines are hard to finance
- China can flood the market or restrict exports
- strategic supply chains remain vulnerable
- private capital stays away because returns are too uncertain
The Bigger Point
The episode suggests that markets alone may not deliver enough supply of critical minerals when geopolitical risk is rising. In that sense, tungsten becomes a window into the broader debate about:
- de-risking supply chains
- industrial policy
- defense preparedness
- long-term strategic stockpiling
Notable Insights
- “Tungsten is like a century-old missing prediction market for war.”
- “China has the best geology” for tungsten, which helps explain why it dominates supply.
- The metal’s value tends to rise not because of steady consumption, but because of fear, urgency, and wartime needs.
- Even a relatively small mine can matter if it supplies a meaningful chunk of the non-Chinese market.
- The episode compares tungsten to other strategic materials like helium and rare earths, where governments sometimes fail to preserve critical capacity.
Final Thought
The episode’s central argument is that tungsten is more than a quirky metal or novelty cube — it is a strategic asset whose market behavior may be quietly signaling a world preparing for conflict. The reopening of a small mine in Tasmania becomes a much bigger story about industrial policy, military readiness, and how vulnerable global supply chains really are.