China’s tightening grip over tungsten exports has become the latest illustration of the geopolitical risks embedded within modern technology supply chains by underscoring a critical vulnerability across a supply chain that spans from Japanese chemical producers to the world’s largest semiconductor manufacturers.
Tungsten rarely attracts public attention, but it is one of the world’s most strategically important industrial metals. Possessing the highest melting point of any pure metal at 3,422°C and exceptional hardness, tungsten is indispensable across semiconductors, aerospace, defence, industrial machinery, electric vehicles and energy technologies.
Within semiconductor manufacturing, tungsten hexafluoride gas enables the deposition of ultra-thin tungsten layers that form electrical interconnects inside integrated circuits. Any disruption to its supply can ripple through the production chains of major chipmakers.
Reports emerged earlier this month that Japanese industrial gas suppliers have effectively run out of access to high-purity Chinese tungsten powder, forcing a collapse in domestic production of tungsten hexafluoride (WF6), a specialised gas used extensively in advanced semiconductor fabrication.
Japanese suppliers Kanto Denka and Central Glass are said to have notified their clients, including Samsung, SK Hynix and TSMC, that they would cease tungsten hexafluoride production from July 1, 2026, due to raw material shortages caused by Chinese export restrictions.
China dominates virtually every stage of the tungsten ecosystem.
According to the U.S. Geological Survey (USGS) Mineral Commodity Summaries 2024, China accounted for roughly 82-83% of global mine production in 2023, producing approximately 63,000 metric tonnes out of a worldwide total of 78,000 metric tonnes. It also controls the overwhelming majority of downstream refining and processing capacity.
Beijing introduced export controls covering eight tungsten products in February 2025, a move that industry analysts say contributed to a roughly 40% year-on-year decline in export volumes and drove tungsten prices sharply higher as inventories tightened and industrial demand remained strong.
These restrictions are part of a broader pattern that has already affected gallium, germanium, antimony and indium phosphide, demonstrating China’s willingness to weaponise upstream material dominance amid intensifying technological competition with the United States and its allies.
Besides, China’s export restrictions may not simply constrain global supply but also strengthen the country’s position within higher-value semiconductor supply chains.
If foreign manufacturers lose access to Chinese tungsten powder while Chinese companies retain unrestricted domestic access, Beijing could leverage its raw material advantage to expand indigenous production of semiconductor gases.
Instead of merely exporting raw tungsten or intermediate compounds, China could increasingly export processed semiconductor-grade materials directly to domestic chipmakers and overseas customers that remain accessible under its licensing regime.
This strategy would mirror developments already observed in other critical minerals sectors, where China has used upstream dominance to build commanding positions in refining, battery materials and solar supply chains.
That said, the implications extend far beyond semiconductors. Going forward, suppliers will have to be evaluated no longer solely on cost or efficiency, but increasingly on geopolitical reliability.
For instance, China’s export controls have largely targeted Japan, while South Korea has retained access to tungsten powder imports.
So, Samsung and SK Hynix, which have traditionally depended on Japan for around 80% of their tungsten hexafluoride supplies, appear to be pivoting towards domestic suppliers SK Specialty and Foosung, despite those companies also relying on Chinese tungsten powder imports, illustrating how geopolitical considerations can override market forces.
SK Specialty has signed a long-term supply agreement with Samsung covering 150 tonnes per month, while Foosung has begun a certification process with China Shipbuilding Special Gases in preparation for bulk imports scheduled to begin in August.
That advantage, however, could prove temporary if Beijing chooses to broaden the scope of its restrictions, leaving South Korean manufacturers vulnerable to the same supply disruptions.
Hence, nations and companies are urgently working to develop tungsten mines outside China. The U.S. Defense Production Act, EU Critical Raw Materials Act, and parallel initiatives in Canada, South Korea, and Australia are all attempting to diversify supply through new mine development, recycling capacity expansion, and strategic stockpile programs.
Also, China’s export controls may have created a favourable environment for alternative suppliers, particularly due to the surge in tungsten prices that they have caused.
For years, alternative tungsten producers struggled to compete against cheaper Chinese output. However, Beijing’s latest export controls, which have tightened inventories and driven prices higher, may alter that dynamic by improving the commercial viability of projects that were previously considered commercially marginal.
Supply Concentration in China Drives Investment in Alternative Sources
Vietnam, South Korea, Australia, Portugal, Spain, and, to a lesser extent, Russia, Kazakhstan, Austria, and Bolivia are the primary non-Chinese sources of Tungsten. This article will cover only Vietnam, South Korea, Australia, Portugal and Spain, and it will also discuss the United States and Canada, both of which possess resources but lack scale.
Vietnam
Vietnam currently represents the most significant non-Chinese tungsten producer.
The country’s Nui Phao mine, operated by Masan High-Tech Materials, a subsidiary of Massan Conglomerate, has become one of the world’s largest tungsten operations outside China. Also, Vietnam’s importance stems not only from its mining output but also from its growing downstream processing capabilities.
Its strategic location, existing industrial infrastructure and participation in global manufacturing networks position Vietnam as an attractive alternative supplier for East Asian semiconductor ecosystems.
That said, Vietnam alone cannot address the supply concentration risk in China, as its output remains a fraction of China’s production, meaning diversification efforts will require multiple suppliers simultaneously.
Moreover, lower ore grades and reduced throughput contributed to a 15% year-on-year drop in production at the Nui Phao mine in 2024, while concerns also remain over the possibility of the asset eventually coming under Chinese control.
Last year, Reuters reported, citing unnamed sources, that Massan Conglomerate had signalled an interest in selling the asset, and two Chinese companies had approached foreign firms to act as proxy bidders, potentially allowing them to gain influence over the business without publicly disclosing their involvement.
Australia and South Korea
Australia and South Korea could become the biggest beneficiaries of the ongoing re-orientation of the Tungsten supply chains.
Australia may not currently rank among the largest tungsten producers, but it possesses substantial geological advantages. It has the world’s 2nd largest tungsten resources, with tungsten deposits distributed across several Australian states, particularly Queensland, Tasmania and New South Wales, according to Queensland Government Geoscience Data.
The country’s strengths lie in political stability, established mining expertise and strong partnerships with Western economies, and it is therefore better positioned as a medium-to-long-term diversification pillar.
Several projects are now advancing across the country, including the Mt Carbine expansion (Queensland), the Dolphin mine tailings redevelopment (King Island, Tasmania), as well as the exploration-stage and advanced development projects at Hatches Creek (Northern Territory) and Watershed (Queensland), respectively.
Among them, Mt Carbine is by far the most important project to mention because it is Australia’s sole active tungsten producer currently, which is undergoing a major expansion and has secured a non-binding indication of support for up to US$34 million from the U.S. Export-Import Bank (EXIM) under its Supply Chain Resiliency Initiative, underscoring Washington’s efforts to cultivate non-Chinese sources of critical minerals.
Now, coming to South Korea, which just like Australia, is not a major current producer, but the country’s Sangdong mine, recently revived by Canadian company Almonty Industries, could be a game-changer.
According to Almonty, Phase 1 commissioning was completed in March 2026, bringing the mine back into operation after more than 30 years. The facility is designed to process approximately 640,000 tonnes of ore annually and produce about 2,300 tonnes of tungsten concentrate each year.
A second expansion phase scheduled for 2027 would increase processing capacity to 1.2 million tonnes of ore annually and raise output to approximately 4,600 tonnes per year. At full capacity, Sangdong could supply around 40% of global tungsten demand outside China.
Also, the project’s strategic significance extends beyond mining, as Almonty’s plans entail a ‘Korean Trinity’ model comprising mining, refining and tungsten oxide production, potentially transforming South Korea into one of the world’s significant tungsten processing hubs outside China.
That would also place South Korea in a uniquely advantageous position in the semiconductor sector because it already hosts some of the world’s largest semiconductor manufacturers, including Samsung and SK Hynix.