Wolf Minerals provides market with tungsten update

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Australian specialist minerals exploration and development company Wolf Minerals released some interesting information to the market.

The company released an update on the tungsten market, which highlights a strong outlook for future price and demand and, unsurprisingly paints a rosy picture for its flagship project.

Wolf’s core project is the Hemerdon Tungsten and Tin project in Devon, in the UK, where Wolf is close to finalising its Definitive Feasibility Study.

The Hemerdon Project is 100% owned by Wolf Minerals and is claimed by the company to be one of the largest undeveloped tungsten and tin resources in the western world.

It lies 10 kilometres north east of the port of Plymouth in the south west of the UK with a history of mining and established infrastructure.

Wolf is proposing to develop Hemerdon by low cost open pit mining.

Tungsten Market highlights
• Outside of China, the tungsten price is represented by the price of Ammonium Para Tungstate (APT). The APT price is published in Metal pages and Metals Bulletin.

• APT is rising with increasing global demand and limited supply from China.

• Tungsten product prices are quoted in metric tonne units (mtu), where 1 mtu = 10kg (so $400/mtu equates to $40,000/tone).

• Price
    o APT prices are currently trading between US$420 and US$430 (Metal pages Ltd. 3 May 2011).
    o Prices for APT are forecast to increase to an average of US$475 per mtu in 2012.

• Demand
    o Tungsten demand correlates closely with economic output – tungsten demand in one year reflects growth in GDP the previous year.
    o Global tungsten demand forecast to increase at an annual growth rate of 6-7% – from 70,051tonnes of tungstic oxide (W03) in 2010 to 111,602 tonnes of W03 in 2015.

• China Impact
    o China is largest user of tungsten and accounted for 62% of world consumption in 2009
    o Chinese demand expected to grow by 7% per year

• Tungsten Use
    o Largest end-use is in manufacture of hardmetals (cemented carbides) which accounted for approx 54% of global consumption in 2009
    o This is followed by steels/alloying sector – approx 27% of global consumption
    o Mill products (13%) and other applications (6%) make up remainder of end-use