Higher manufacturing output...to support gains
Processed tungsten demand to grow 4.2pc
DUBAI, August 5, 2015
The global demand for processed tungsten has been projected to advance 4.2 per cent annually to 146,400 tonnes in 2019, according to a study.
The ‘World Tungsten’ study by The Freedonia Group, a Cleveland-based industry research firm, pointed out that the sales gains will be fuelled by solid growth in fixed investment expenditures, especially in construction spending and mining activity.
The higher manufacturing output will also support gains, particularly in the key aerospace, machinery, and metal products sectors, it said.
The increased production in these industries will spur demand for tungsten-containing cutting tools, dies, drills, weights, and wear parts.
According to analyst Zoe Biller, “Tungsten alloys will record the fastest growth of any major product category, stimulated largely by aerospace manufacturing increases.”
However, cemented carbides will continue to account for the largest share of processed tungsten consumption due to their widespread use in replaceable cutting tools and inserts, the study said.
The Asia/Pacific region, led by China, will continue to dominate both tungsten supply and consumption. In 2019, China alone will account for over half of sales and three-fifths of output, it said.
The country’s outsized influence on the global tungsten market is a combination of its vast tungsten reserves (over half of known tungsten deposits in the world) and the Chinese government’s support of industries that manufacture value added tungsten products.
These factors, along with China’s restrictions on exports of tungsten ore, caused a rapid spike in prices over the past decade, although this will moderate through 2019 as export restrictions are eased.
China’s historically low mining and labour costs have also played a role in the size of its market and output, although labour costs in the country are rising and increased use of scrap across the globe is making processed tungsten sourced from outside of China more financially attractive.
India will be the fastest growing major market for processed tungsten through 2019, fuelled by a rapidly expanding manufacturing sector with increasingly advanced technological capabilities, said the study.
The other nations that are expected to record above average tungsten sales increases through 2019 include Turkey, Mexico, China, and Taiwan, as demand in these countries will be driven in large part by rising output of motor vehicles and other durable goods.
The demand in the US, Japan, and the developed markets of Western Europe will post slower growth, although the US will still record solid advances, it added. - TradeArabia News Service
