China Increases Tungsten Mining Quotas for 2024: A Strategic Move Amid Tightening Supply

Chinese Tungsten

The Chinese government has officially raised its tungsten mining quotas for 2024, marking another year of strategic resource management. According to the Ministry of Natural Resources, the new quota is set at 114,000 tons of tungsten trioxide (WO3) equivalent, up from 111,000 tons in 2023. This increase follows previous increments from 109,000 tons in 2022 and 108,000 tons in 2021, highlighting China's ongoing efforts to control and optimize its critical mineral resources.

Key Distribution Across Provinces

The updated quotas have been distributed across 15 provinces, with Jiangxi province—home to the leading producer Jiangxi Tungsten—receiving the largest allocation of 40,300 tons. This represents 35% of the total national quota. Hunan province, another significant region in China’s tungsten production landscape, was allocated 30,000 tons, up from 27,300 tons in 2023 and 26,100 tons in 2022, comprising 26% of the total quota.

The Importance of Quota System

China introduced the tungsten production quota system in 2002 to safeguard its valuable resources. Despite the quotas, actual production has often exceeded these limits. For example, China produced 117,109 tons of tungsten in 2023, 127,300 tons in 2022, and 138,900 tons in 2021, according to the National Bureau of Statistics. However, the gap between quotas and actual production has been narrowing, partly due to the frequent closures of smaller mining operations driven by stringent environmental policies and rising production costs.

Impact on Tungsten Supply and Prices

The tightening supply of tungsten concentrate, exacerbated by the depletion of high-grade resources and the shutdowns of smaller mines, has led to a steady increase in tungsten prices. Nevertheless, the downstream demand from the manufacturing sector, which is the primary consumer of tungsten, remains moderate. This is largely due to ongoing uncertainties in global economic growth, which continue to impact the broader market dynamics.