A Strategic Mine's Rebirth Amid a Global Tungsten Squeeze

A critical shortage of tungsten hexafluoride gas threatens semiconductor production. Almonty's Sangdong mine, restarting after 30 years, is poised to supply 40% of non-China tungsten demand amid soaring prices.

The global semiconductor industry is facing a raw material crisis with no easy fix. A report from Digitimes on Thursday highlighted an acute shortage looming for South Korean chipmakers: tungsten hexafluoride (WF6), a gas essential for semiconductor manufacturing. Japanese suppliers have warned their South Korean customers that shipments cannot be maintained beyond this summer, a direct consequence of Beijing's severe export restrictions on tungsten. For Almonty Industries, the timing of its Sangdong mine's revival in South Korea after 30 years of dormancy could not be more opportune.

Tungsten prices have recently breached $3,000 per metric tonne unit (MTU), a historic all-time high. Since late December, the price has more than tripled. This surge is based on the industry standard ammonium paratungstate (APT), whose spot price had already climbed to $2,250 by mid-March following U.S. tariffs on Chinese tungsten and subsequent Chinese counter-sanctions. With its extremely high melting point, tungsten is considered irreplaceable for the foreseeable future, tightening the supply vise further.

Almonty has completed the first phase of commissioning at its Sangdong asset, which is initially designed to process 640,000 tonnes of ore annually, yielding about 2,300 tonnes of tungsten concentrate. The mine boasts an expected lifespan exceeding 45 years and an average ore grade of approximately 0.51% tungsten trioxide—roughly three times the global average. At full capacity, Sangdong is projected to supply around 40% of the world's tungsten demand outside of China, a region collectively controlled by China, Russia, and North Korea for an estimated 95% of global supply.

Analysts are painting a stark picture of the structural deficit. BMO strategists forecast a further supply shortfall for 2026, noting Western efforts to build alternative supply chains will take years to reach meaningful capacity. With global industry stockpiles expected to last only until June, Almonty is positioning itself to fill the gap in the second half of the year.

The financial projections for Almonty reflect this pivotal moment. While the company's smaller Panasqueira mine in Portugal generated revenue of CAD 32.5 million in 2025, analysts project 2026 revenue to leap to CAD 747.7 million, driven by Sangdong's ramp-up. Expected EBITDA stands at CAD 488.1 million, implying a margin of over 50%. The management itself is targeting annual revenue of approximately one billion Canadian dollars with a net margin of 60% by 2028.

This outlook has triggered a wave of analyst upgrades. GBC analysts raised their price target from CAD 9.00 to CAD 28.60, citing the accelerated production ramp in Korea and the structural supply deficit. Alliance Global analyst Jake Sekelsky lifted his target from $14 to $19.25, reaffirming a buy rating. Other firms followed suit: B. Riley increased its target from $17.00 to $23.00, and Oppenheimer adjusted from $16.00 to $19.00.

The market has taken note. Almonty's stock has surged nearly 700% from its 52-week low of CAD 3.09 in April 2025, gaining over 690% year-on-year to trade recently at CAD 24.43. Institutional interest is swelling, with the number of invested funds rising 55% last quarter to 107. Financially, the company is equipped with liquid funds of CAD 268.4 million following a December capital raise, offsetting a net loss of CAD 161.9 million on revenue of CAD 32.5 million for the 2025 fiscal year.

Geopolitical tailwinds are strengthening Almonty's position. The U.S. government has explicitly exempted the company's tungsten ores, concentrates, and oxides from counter-tariffs, underscoring the material's strategic importance for defense, aerospace, and semiconductors. A critical deadline looms: starting January 1, 2027, U.S. defense contractors must source tungsten exclusively from non-Chinese suppliers.

Almonty's growth pipeline extends beyond Sangdong. A planned Phase 2 expansion, slated for operation in 2027, would double processing capacity to about 1.2 million tonnes of ore annually and roughly double tungsten production to 4,600 tonnes per year. The company's "Korean Trinity" strategy envisions a fully integrated value chain from the mine to a tungsten oxide plant and a nearby molybdenum deposit. Furthermore, the Gentung Browns Lake project in Montana is scheduled to be production-ready in the second half of 2026, adding another non-Chinese source.

Whether Sangdong meets its ambitious production targets this year will become clear in upcoming quarterly results. For now, Almonty Industries finds itself at the center of a perfect storm where geopolitics, critical supply shortages, and strategic mine development have violently converged.