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TDDW, here's AI's distillation. All the experts I've read, and provided links to, say similar. If you know better, fine: but it's you v them, not you v me.

"Yes, there is a significant risk of force majeure in the tungsten market over the next three years, primarily due to severe supply deficits and geopolitical factors.

Here's why:

Structural Deficit and Limited New Supply: The tungsten market is experiencing a severe structural deficit. BMO Global Commodities Research analysts note that the world has "sleepwalked" into a tungsten crunch due driven by declining ore grades, environmental restrictions, and a lack of investment in new mining (mining.com).

Global inventories are critically low, and another deficit is forecast for 2026 (mining.com).

Canaccord Genuity also forecasts a market in deficit until 2030, with limited new projects and increasing demand

(theoregongroup.com).

New mines take years to permit, finance, and build, and there's a scarcity of high-grade deposits outside of China

(theoregongroup.com).

Chinese Export Restrictions: China dominates the global tungsten market, accounting for roughly 75-80% of global mine supply and over 85% of APT (ammonium paratungstate) refining capacity (mining.com) (theoregongroup.com) (skillings.net)

Beijing imposed export licensing in February 2025, which led to a roughly 30% year-over-year cut in available supply and a 70% year-over-year drop in exports for some products (skillings.net) (medium.com). These controls are expected to remain in place, and a return to 2023 export volumes is not anticipated even with a partial reopening (veronken.substack.com).

US Defense Procurement Deadline (DFARS): A new US law taking effect on January 1, 2027, will restrict the procurement of tungsten from China, Russia, Iran, and North Korea for defense applications (theoregongroup.com)(medium.com). This Defence Federal Acquisition Regulation Supplement (DFARS) deadline creates a "cliff" for defense contractors who will need fully traceable non-Chinese supply (veronken.substack.com). Industry has warned that compliant supply won't exist by this deadline (medium.com). This policy has created a two-tier market, with American buyers unable to legally source from China and Chinese exporters unable to legally ship to American military end-users (veronken.substack.com).

Lack of Substitution and Refining Capacity: Tungsten is considered irreplaceable in many critical applications, such as armor-piercing ammunition, jet engine turbine blades, and drilling bits (skillings.net).

Substitution is challenging and would take 5-10 years to validate alternatives and retool manufacturing (skillings.net)

Additionally, non-Chinese refining capacity is limited, covering less than 25% of global demand, and rebuilding this infrastructure could take 3-7 years (medium.com). So even if new non-Chinese mines come online, the refining bottleneck could still lead to supply disruption.

TDDX, if you don't want to read the article, here's the headline: "CICC [= China International Capital Corporation] Forecasts 17% Tungsten Supply Gap Trhough 2028: Survival Strategies for the High-Price Era". It's actually worth reading.

BTW I fully take on board your point that, in the long run, a tungsten shortage could even work out in HDD's favour. I wouldn't disagree, but as you say, "that won't happen": certainly it seems a remote scenario.

In the meantime, we are faced (in terms of the RXTC release) with CICC, as above, forcasting a 17% tungsten supply gap between now and 2028. Read my lips - if they're right, there simply won't be enough tungsten to go round, particular if the present geopolitical standoffs continue. There will be cases of force majeure and some users of tungsten may have to go short. Of course RXTC may be overstating the problem. Of course HDD may find ways round, perhaps already have, and as a LTH I very much hope they do. Problems are there to be solved. But to bury one's head in the sand as NTG does and pretend that the sky is blue and there's absolutely nothing to worry about, move along please nothing to see here, la la la la la, is plain ridiculous. All I'm suggesting is that the HDD Board should make a public statement on the subject. If they with their ear to the ground aren't concerned, then let them say so and explain their reasoning. I'll be greatly relieved.

(FYI: Many years ago I held shares in Geodex, which at the time owned the Sisson tungsten project in Canada. It was taken over by Northcliff Resources in 2012.)

NTS, you know perfectly well that my reference (which you quote) was to HDD's EXPANSION in the short term, not to its TRADING in the short term. This of course was about buying extra reactors, at £1.3m a pop, in the face of the risk that they could be lying idle for a while. The consensus view among posters was, I think, that two or at least one of these was going to be ordered in the next 6 months or so, to be production-ready in say 15-18 months' time. I was pointing out that there might be a risk factor to that.

As Cavendish's latest report makes clear, HDD now doesn't plan to buy any new reactors until 2028. That is excellent news, the more so as HDD has clearly found ways to increase turnover substantially without the immediate need for new reactors.

The concerns about the risk of force majeure (perhaps 1-2-3 years down the line, obviously I don't mean now) remain. Not saying it *will* happen, merely that it *could*. Please read this: https://ruixintungstencarbide.com/cicc-tungsten-supply-gap-2026-2028-high-price-era-20260513/ and please bear in mind that the issue is not about price, but about availability.

To repeat: it would be great if HDD could make public its own perspectives on the issue.

If you want to engage further, then please leave off the name-calling. It's childish and unnecessary. I'm always happy to engage in serious debate.

If not, that's fine by me.

TDDW - I'm as keen as you to keep this an HDD board. I was reacting to the uncalled-for offensive remarks of another poster, not you.

I really don't know how much tungsten gas HDD uses, do you? No doubt it's not all that much in the greater scheme of things. But plainly, to HDD it's an essential material, without which it couldn't function.

HDD did in fact flag the risks in the 2025 annual report - see risks table on page 21 ("Risk that supply chain bottlenecks could impact growth potential ...") I believe the report was published in January 2026, and that the [perceived] potential future problem for tungsten users has come to the fore only more recently. (What homework am I being accused of not having done?)

If you'll forgive me trying to paraphrase, and please correct me if I've misunderstood, you make the point that because HDD is vital to the oil, plane etc industries, in the event of a scarcity of tungsten gas it could claim priority. That's an attractive and comforting thought. I do hope that, somewhere along the line, the HDD Board itself will feel able to comment on this and give us all reassurance. Indeed, that's the message I've been trying to signal all along.

What a pity that some people have forgotten the rules of common courtesy.

Where have the board stated that there are no tungsten shortages? (Not tungsten shortages *now*, I have at no time suggested *now*: if the problem needs to be faced at all - *and I stress yet again that it may not!!* - the crunch point / bottleneck if you like / would most likely arise in something like 12-18-24 months' time. The scenario then would be that defence and electronics companies are screaming for tungsten, thanks to huge growth in demand, while the growth in worldwide mining capability is there, but is not strong enough to match that extra demand. So (on that scenario) some users, somewhere, wouldn't be able to get their tungsten *at any price at all*, there would simply not be enough to go round. And I would expect the issue to be resolved in due course, a short term blip but enough to cause serious difficulties to many users of the metal.

This is NOT scaremongering and NOT spreading of false rumours, nor indeed of any rumours at all.

Nor is it anti-Hardide, which has just published quite superb results and which gives every indication that there's much, much more to come.

Nor did it tank the Hardide share price, which closed yesterday at 41.5p - the highest since March 2020, I believe - and today at 49p.

I have quoted numerous authoritative sources for the wider tungsten issue. Despite that, opinions vary (that's perfectly healthy) and of course it may never happen. If it doesn't, so much the better.

What part of the above do you not understand?

Pj70 - Agreed. But bear in mind that there is a finite quantity of tungsten available outside China, and even though new mines are starting to come onstream, growth in demand is arguably outpacing growth in supply for the next few years. Paying more for a commodity is all well and good, but won't cut the mustand unless there's enough to go round, otherwise some buyers won't be able to get hold of it at any price. (In fairness, the point has been very helpfully made that major HDD customers such as Airbus may be able to pull rank in case of need.)

NTS, you'll be pleased to know this will be my last word on the subject. The *only time* that I have referred to the short term is in the context of Hardide ordering additional reactors. As you will know, these can take up to 12 months to come on stream. So supposing (hypothetically) that they were to order a reactor today, they would need to be confident that a regular additional supply of tungsten gas is going to be available in 12 months' time and onwards. I don't believe most people would see that as the short term.

In today's RNS the company has very encouragingly stated that it is testing both (1) ways to expand capacity without the need for new reactors, and (2) ways to substantially increase the turnover from each new reactor. Both of these will require a regular additional supply of WF6 gas.

The $64,000 question is whether the new tungsten mining capacity from Sangdong, Hemerdon, Kazakhstan and elsewhere will or will not be sufficient, in terms of both volumes and timing, to meet the expected surge in demand ovr the next 2-3 years from numerous customers, many of them much larger groups than HDD. If it so proves, great. If not, there may well be a bottleneck for maybe a year or two, plain and simple. As I say, none of us yet know the answer.

Hope that's clarified any misunderstandings.

End of message.

NTS

I certainly do not accept that I am wrong. I have made it clear that I don't know the answer: with no disrespect, no more do you or any of us. All I have said is that there is a concern about the availability of tungsten gas *in the medium term future*, not for the present. That concern may be quickly resolved, a relatively short-term blip - in which case we'll all be happy - or it may take a year or two longer: time will tell. Much will depend on geopolitics.

The acid test will probably not come until perhaps 1-2 years' time, by when the company should have achieved both substantial additional customer demand and the production capacity to meet it, and needs only to find a sufficient, and regular, supply of tungsten gas at (maybe, hopefully) up to double the volumes it is currently using.

You're perfectly entitled to your views. Have the grace to grant the same courtesy to those with whom you disagree.

Quite outstanding results, congratulations to all concerned. I now fully expect Cavendish's FY26 projection to be beaten. And FY 27 onwards to be better still.

A pity perhaps that the RNS is silent on the availability of sufficient tungsten hexafluoride after FY26 to meet its growth plans, in particular whether it will be able to source sufficient extra supplies over the next 1-2 years to not delay the purchase of additional reactors. But that's just me being a bit churlish, and doesn't detract from this superb RNS.

Among the gems: "Each coating reactor has a capital cost of circa £1.3m. We are working on and testing design improvements intended to realise significant improvements in the output of future coating reactors, with the aim of improving the ratio of annual revenue to capital cost for each new reactor from 1-2 times to 3-4 times." If achieved, that would be dramatic.

Thanks AI, it seems to me that it could go either way, but time will tell. Let's hope the company makes at least some sort of comment tomorrow. If they come out with a robust view, that should be very bullish for the share price.

I genuinely have no idea whether tungsten mining are as readily capab le of being ramped up as other metals. I asked AI "Can tungsten mining volume/yield be easily ramped up in case of need" and it replied:

"No, tungsten mining volume and yield cannot be easily or quickly ramped up. The industry faces structural constraints including declining ore grades, complex processing requirements, and massive geopolitical centralization. Bringing new mine supply online is a multi-year process that cannot solve short-term, urgent supply shocks.

Key Bottlenecks in Supply

Geopolitical Concentration: China controls roughly 80% of global mine production and dominates downstream processing. State-enforced mining quotas and export controls on dual-use materials have sharply limited global availability, pushing ammonium paratungstate (APT) prices to record highs.

Lead Times for New Mines: Building a tungsten mine requires significant upfront capital and typically takes three to five years before stable operations and scaled production can be achieved.Declining Ore Grades: Many older, currently operating mines are grappling with lower-quality ore, meaning it takes much more rock extraction and energy-intensive processing to yield the same amount of pure tungsten.

Specialized Refining: Tungsten's incredibly high melting point (around \(3500^{\circ }\)C) and the complexity of recovering it as a primary product—or a by-product of other ores like tin or zinc—require highly specialized processing facilities that are currently scarce outside of China."

...which makes me wonder whether AI, notoriously unreliable anyway, has somehow misunderstood the question. Perhaps you can do better!

AI180 - The fact that Hardide have never mentioned the scarcity issue is precisely the reason I've been getting a tad itchy. Either they are genuinely not concerned, as you suggest but in the face of what appears to be a substantial body of informed comment to the contrary; or they've decided, consciously or unconsciously, to gloss over the issue - perhaps in the hope that it will blow over or that no-one will notice. Hopefully things will become clearer tomorrow!

Incidentally I like your point about Airbus and the major energy customer being in a position to pull weight.

AI180: Thank you, that makes sense. Like you, I hope the company will address the point in tomorrow's RNS.

NTS11: "Management already referenced this and have claimed it's not a short or medium term concern". Where: can you provide a link please? In the 28 April RNS they referenced only the price increase and that they were taking steps to mitigate it: so far as I can see, they didn't reference the potential scarcity issue which other experts have been flagging, as distinct from the price issue. If I've misssed something, I'll be only too glad to hear.

(I think there's a consensus that the reference in the RNS to energy costs, at 3% of turnover, relates to conventional oil and gas as distinct from tungsten gas, which is effectively a raw material as distinct from energy. Obviously the £700,000 gross increase in the cost of tungsten gas for H2/26 is 10%-11% of turnover just on its own.)

There's another one.

Not saying you're wrong - indeed I very much hope you're right - but what makes your view more valid than those of the experts?

For the avoidance of doubt: I have a sizeable holding in HDD, much of it held for >10 years, and despite my concerns about future tungsten gas availability, I feel very positive about the outlook for the group both short and medium term.

Nonetheless I do have real worries about tungsten gas supply, and I've already provided ample evidence that those worries are shared by what appear to be experts in the field. Here's another (admittdly datelined 11 May, before the recent drop in the tungsten price]: https://www.sunsirs.com/commodity-news/petail-32716.html

I wish I could say that the opinions of a couple of anonymous bulletin board posters, who've provided no evidence of their personal expertise in the field, filled me with the same level of confidence. Sorry, but they don't. I also wish I could disregard the arrogance of TDDW sneering ("Sigh") at those who venture to politely make observations which he finds displeasing. That's simply not on. Please note, I'm not saying you're necessarily wrong, just that to recognise that there's room for more than one view is no more than common courtesy.

Tungsten: "CICC forecasts a global deficit of 20,000 MTU by 2028, as demand explodes from defense, semiconductors, EV batteries, and AI data centers."

https://goldinvest.de/en/tungsten-prices-explode-in-2026-supercycle-driven-by-china-quotas

As I say, yer pays yer money.....

You pays your money, you takes your choice!

See also: https://investornews.com/critical-minerals-rare-earths/tungsten-and-the-new-global-supply-chain-war/

Hmmm. After reading your post I asked Google AI, and this is what it said:

No, the expected increase in tungsten production outside of China over the next 2-3 years is not considered sufficient to meet the rapid growth in global demand. Substantial supply deficits are projected to persist. While several allied countries are rushing to restart or develop domestic sources, the slow pace of mine development and China’s dominant control of mid-stream refining are major hurdles.

Key Market Dynamics

The Supply Deficit: Industry analysts, including BMO and Macquarie, estimate that total new overseas mining capacity will likely add less than 5,000 metric tons per year. This is highly insufficient against a looming demand projection that could increase global tungsten consumption significantly by 2035.

The "China Factor": China controls approximately 75% to 80% of global primary mine supply and dominates the refining of Ammonium Paratungstate (APT) and tungsten powder. Recent moves—such as slashing export quotas, reducing approved exporters to just 15 firms, and targeted bans on dual-use technology exports—have severely squeezed the international market.

Notable Non-China Projects in the Pipeline

To counter China's export limits, Western governments and critical mineral developers have heavily funded projects outside of China. However, these require 3 to 8 years from exploration to commercial production:

South Korea: Almonty Industries (NASDAQ: ALMI / ASX: AII) has commenced mining at the Sangdong mine—one of the largest tungsten reserves outside of China. A planned Phase 2 expansion is slated to come online in 2027.

United States & Canada: With no active commercial tungsten mines in the U.S., heavy defense funding is pushing projects forward. Almonty is eying development at the Gentung project in Montana, while Canadian developments like the Mactung site are also advancing.

Europe: Mining developers are pushing the Borralha and Vila Verde projects in Portugal, and the Mt. Carbine and Barruecopardo operations in Australia and Spain. [Hemerdon not mentioned, for whatever reason]

Surging Demand Sectors

Defense & Aerospace: Defense spending is the primary growth driver, with annual demand in this sector growing by roughly 8%. Tungsten is a critical, irreplaceable material used for heavy armor, tank barrels, and advanced missiles.

Industrial Manufacturing: Traditional cemented carbides for cutting tools, drills, and wear parts remain the largest consumers of tungsten.

New Energy & Electronics: The semiconductor and photovoltaics (solar) industries are rapidly increasing their intake of high-purity tungsten for advanced nano-level manufacturing and solar cell production.

Impact on the Market

Because tungsten is highly inelastic (meaning it cannot be easily substituted in most of its heavy industrial and military uses) and recycling cannot scale quickly enough, this widening supply/demand gap is expected to keep global prices elevated.

Thanks AI180.

You write "The interesting part will be what Hardide says about Capacity, the US customer, forecast for FY 2027 and the cost of Tungsten gas". Agreed - but beyond the cost of tungsten gas, I would also hope they comment on its availability irrespective of price. Trump's visit this week has not visibly resulted in China relaxing its export restrictions, and tungsten demand is increasing rapidly, while much new western production is 2-3 years from coming onstream. I'm concerned that this could amount to an existential threat to world tungsten supplies which (at worst) could threaten Hardide's expansion capability altogether in the short term. It's no good installing new reactors unless you can buy the gas to put in them. I sincerely hope I'm wrong, but any comfort would be welcome.

Sorry JRC not JRS