Tungsten’s sixfold surge: Pakistan’s mineral processing opportunity

A sixfold rise in tungsten prices says more about who refines critical minerals than who holds them. Pakistan ships concentrate abroad and buys the finished metal back - a gap that $1.3 billion of US financing does not by itself close.

The price of tungsten rose 622% between January 2025 and April 2026, according to the International Energy Agency’s Global Critical Minerals Outlook 2026. Tantalum climbed 196% over the same period, cobalt 134%, neodymium 116% and lithium 108%. Even copper, aluminium and chromium - the base metals underpinning power grids and steelmaking - rose between 39% and 53%.

The rally is not speculative. It reflects a structural shift in how the world sources the raw materials of the technological and defence age. Tungsten’s surge tracks Chinese export controls colliding with firm demand for a metal used in cutting tools, aerospace components and munitions.

• Tungsten is a metal known for having the highest melting point of all metals (3,422°C) and exceptional hardness, strength and density. It is widely used in industrial applications, including cutting and drilling tools, mining equipment, military ammunition, aerospace components and high-temperature machinery. Tungsten is also used in specialised alloys, electronics and electrical contacts because of its ability to withstand extreme heat and wear.

China controls the overwhelming majority of global tungsten mining and a larger share still of its refining; when Beijing tightens licensing, world markets move immediately. Not every line on the chart is a China story. Cobalt’s rise owes more to export restrictions in the Democratic Republic of Congo, lithium’s to energy-storage demand outrunning supply. The common factor is concentration. The IEA estimates China accounted for roughly 70% of refined production across key energy minerals last year. Where one country refines most of what the world needs, price becomes a function of policy.

For Pakistan, the numbers arrive as mineral wealth moves from speculative headline to active diplomacy. Reko Diq, the copper-gold project in Chagai held 50% by Barrick, 25% by federal state-owned enterprises and 25% by Balochistan, secured $1.3 billion from the US Export-Import Bank in February under Project Vault, a $10 billion initiative to build American strategic mineral reserves and diversify supply away from China. Reko Diq is the only non-US transaction in that portfolio. Total project cost is put at around $3.2 billion, with first production targeted for 2028. EXIM already sat among the project’s prospective lenders in 2025, alongside the IFC, the Asian Development Bank and export credit agencies from Canada, Germany, Sweden and Finland.

Its reserves copper, gold, silver, molybdenum, cobalt and trace rare earths, including neodymium and praseodymium, which are valued at $60 billion to $74 billion. The frequently cited figure of $6 trillion in national mineral wealth is harder to defend: it conflates unverified geological occurrence with proven, economically recoverable reserves, and Pakistan lacks the JORC- or NI 43-101-compliant resource reporting international investors rely on. More conservative estimates put recoverable value across Balochistan, Khyber Pakhtunkhwa and Gilgit-Baltistan at $100 billion to $300 billion over several decades.

Set against extraction today, the gap is stark. Mining and Quarrying has hovered between 2% and 3% of gross domestic product (GDP) for 25 years, standing at 2.1% of GDP in FY26 after four consecutive years of decline.

Pakistan ranked 51st of 166 countries by total extracted mineral value in 2023, with mineral fuels accounting for 82% of that value. In non-ferrous metals, the category covering rare earths, it ranked 58th at $271 million. Only eleven countries mined rare earths that year; China alone accounted for 66% of output. Pakistan exports raw iron ore and bauxite while importing scrap to feed domestic steel and aluminium mills, because Pakistan Steel Mills’ blast furnace, once the country’s only iron-ore smelter, has been shut for nine years. The country holds the ore but not the processing capacity, exporting potential and buying back the finished input at a markup.

Scarcity in critical minerals is rarely geological. Tungsten is not rare in the Earth’s crust; it is scarce in the market because refining sits in one jurisdiction prepared to use that concentration as leverage. The same applies to neodymium and praseodymium, essential to electric-vehicle motors and missile guidance, and to gallium and germanium, both critical to semiconductors and already under Chinese export restrictions. That is where the value sits. Shipping concentrate abroad, as Saindak, the older Chinese-operated copper-gold mine, has done for two decades, captures a fraction of the chain. Smelting, refining and alloying capture the rest: turning concentrate into cathode-grade cobalt, battery-grade lithium carbonate or magnet-grade rare-earth oxides.

Pakistan has almost no domestic capacity in any of it. The diplomatic position is delicate. Pakistan is deepening a decades-old resource and infrastructure relationship with China through CPEC while being courted by Washington as an upstream supplier for a Western-aligned chain.

Security remains the binding constraint. Terrorism in Balochistan and Khyber Pakhtunkhwa threatens the workforce, transport corridors and investor confidence the sector requires. Foreign capital has been slow to convert stated interest into signed equity, the long-discussed Saudi stake in Reko Diq being the clearest example. Regulation, meanwhile, remains fragmented across federal and provincial jurisdictions, and the gap between announcement and implementation is wide.

Three priorities follow from the price data. Domestic metallurgical processing capacity, even at modest scale, would keep value addition and the technical expertise it demands onshore. Internationally recognised reserve-reporting standards would convert geological potential into bankable projects rather than trillion-dollar claims. And resolving security and governance questions in Balochistan and the north would address a risk premium no volume of foreign financing offsets. The recalibration underway among industrial powers implies more mining, not less. Whether Pakistan emerges as a node in the global minerals economy or another exporter of unprocessed rock will be settled by decisions taken, or deferred, over the next few years.

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