Over the past year, from August 2025 to August 2026, the Chinese market for 99% purity tungsten carbide (WC) has experienced a dramatic cycle of extreme volatility, ultimately arriving at a state of stabilization. This period was defined by a massive price surge followed by a significant correction, profoundly reshaping the industry’s landscape and product pricing dynamics.

The Historic Rally and Its Drivers

The trajectory began with a historic rally. Driven by stringent export controls on tungsten products implemented in early 2025 and tightening domestic mining quotas, supply constraints collided with surging demand from emerging sectors like photovoltaics and AI-driven PCB manufacturing. Consequently, WC prices skyrocketed, peaking in March 2026 at approximately 2,350 RMB/kg, representing a multi-fold increase from the previous year. This super cycle created a windfall for upstream miners but placed immense cost pressure on midstream and downstream manufacturers.

The Sharp Correction

However, the market could not sustain such heights. By mid-2026, a combination of weak downstream demand during the traditional off-season and profit-taking led to a sharp correction. Prices plummeted by nearly 60% from their peak, settling around 950-1,000 RMB/kg by June. This dramatic swing exposed the vulnerabilities of a business model overly reliant on raw material price arbitrage, forcing a painful but necessary industry consolidation where smaller, less efficient players were squeezed out.

Impact on Product Pricing

The impact on final product pricing has been profound and bifurcated. During the price surge, leading domestic tool manufacturers successfully passed on cost increases, enjoying record margins. However, the subsequent crash eroded this price spread dividend. Today, the industry is witnessing a strategic pivot. With raw material costs stabilizing at lower levels, competition is no longer about who secured cheap inventory, but about technological prowess. Companies are now aggressively repricing and repositioning their product lines, focusing on high-end, high-value-added products like micro-drills for AI servers and premium cutting tools to capture market share from international competitors. The era of easy profits from raw material speculation is over; the future belongs to innovation and high-end manufacturing.

The Path Forward: A New Equilibrium

Looking ahead to the next 90 days, the tungsten carbide market is poised to enter a firm period of stabilization, validating the view that the current price level represents a new, sustainable equilibrium. Several key factors support this outlook:

  • Supply Floor: Domestic mining quotas and export controls continue to restrict supply, preventing a collapse in prices. Upstream miners are no longer seeing eroding profits and have no incentive to flood the market.
  • Q3 Restocking Cycle: While the off-season has suppressed demand, the anticipated Q3 restocking cycle is beginning to provide a baseline of support. Downstream consumers, having adopted a just-in-time procurement strategy, will need to replenish inventory, creating a steady demand flow.
  • Market Correction: The extreme volatility itself has acted as a market corrector. Both buyers and sellers have adjusted their expectations. The speculative frenzy has subsided, and pricing is now more closely aligned with fundamental production costs and genuine end-use demand.

Conclusion

Therefore, for the remainder of 2026, we expect 99% tungsten carbide prices to consolidate in the current range, exhibiting only minor fluctuations. This stability is not a sign of stagnation, but rather a healthy foundation upon which the Chinese tungsten industry can build a more resilient and technologically advanced future.

— HARDCARBIDE Market Analysis Team, August 2026