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In a Down Economy Tungsten Continues to Outperform
The hardest metal on the planet continues to hold its own in the market. Many investors are looking at tungsten as demand has continued to remain consistent as supply falls. The world economy is limping along but tungsten continues to have support. The EU and the UK have both classified tungsten as a critical metal. In the 2011 BGS (British Geological Society) reported tungsten scored 8.5 out of 10. This information has brought the attention of investors and nations alike.
Tungsten is critical to the oil, mining, tool making, national defense and fracking industries. The strategic metal is vital in armor plating and munitions. Tungsten happens to be the hardest element on the periodic table. The metal also has a high resistance to heat and corrosion. Currently there is no substitute for tungsten.
Recently the Portuguese government decided to reopen some of its mines in the north of the country. Portugal is seeking mining companies to help rejuvenate its mining industry which was closed during the 1980´s due to low metal prices and a struggling economy. Portugal has a large deposit of tungsten in Panasqueria. The government in Lisbon sees mining taking a key role in the recovery of its economy. Tungsten is one of many metals that Portugal has access to.
In China we see the opposite happening. They are closing mines around the country, focusing instead on a few large mines. China has shown an interest in providing metals predominantly to its own industry. China has depleted its tungsten reserves for years while prices were low. The government is waking up to the fact that they need a domestic supply of metal in order to continue growing its industry for years to come. In response, Beijing has decided to restrict export of the metal. This has caused the price of the metal to remain at its historic highs. For years China supplied about 85% of the total world supply of tungsten.
On the investor side we see Berkshire Hathaway investing $70 million in Woulfe Mining in February 2012.Woulfe Mining has a large deposit in South Korea which was one of the largest tungsten mines prior to its closure in 1992. Berkshire Hathaway sees an opportunity in the tungsten market, what about private stockpiles? There are private buyers and companies storing tungsten in Switzerland and Panama. If you would like more information on this program you can contact the Panama based team at Swiss Metal Assets.
The future for tungsten is positive. If the strategic metal can perform as well as it has in this miserable economy can you imagine how well it will perform once the world economy recovers? The world economy will rebound, where are you putting your resources?