Almonty Begins Tungsten Output at Sangdong as China's Stranglehold on Supply Intensifies — Stock Under Pressure From $800 Million Convertible
Published on 07/10/2026 at 07:26 | Redaktion boerse-global.de
With the Pentagon warning of tungsten shortages and China controlling more than 80% of global mine production and roughly 90% of processing capacity, Almonty Industries has crossed a critical threshold. Its Sangdong mine in South Korea — one of the largest tungsten deposits outside China — began processing ore into salable concentrate on July 1, 2026. The shift from developer to producer positions the company as the West’s most viable alternative to Beijing’s dominance in a metal essential for armor-piercing munitions, cutting tools, and semiconductors.
The mill is initially chewing through roughly 139,700 tonnes of stockpiled material with a tungsten trioxide grade of about 0.25%. Management pegs the gross value of that inventory at $68 million, enough to keep the plant running for approximately two and a half months as engineers fine-tune processing parameters. Once that phase is complete, the operation will transition to higher-grade underground ore from the Sangdong mine itself.
On the Toronto Stock Exchange, the shares closed Thursday at C$21.03, paring back 9% on the week and sitting nearly 37% below the April peak. The year-to-date gain still stands at a healthy 75%, and over a 12-month horizon the stock has surged roughly 170%. The market capitalization has swelled to €3.78 billion, putting Almonty firmly in the mid-cap bracket.
Should investors sell immediately? Or is it worth buying Almonty?
The recent pullback stems largely from a single financing event. Almonty placed a massive $800 million convertible bond issue, the notes maturing in 2031 with a conversion price of $27.40 per share. The overhang of potential dilution, combined with the inclusion of the stock in the Russell indices at the end of June — which triggered heavy portfolio rebalancing by passive funds — has kept buyers cautious despite the operational progress.
Proceeds from the convertible are earmarked for debt refinancing and balance-sheet strengthening. While the move reduces financial risk, it simultaneously sours near-term sentiment among shareholders who see their equity stake at risk of being diluted. The Relative Strength Index has fallen to around 36, approaching the oversold threshold that historically prompts contrarian buying interest.
Beyond the financing noise, the underlying commodity backdrop is unusually supportive. Global tungsten prices sit at a 12-year high, driven by robust demand from defense and industrial sectors amid ongoing geopolitical tensions. Wall Street analysts, according to recent estimates, see roughly 65% upside from current levels. The immediate catalyst will be Almonty’s next quarterly report — the first to include meaningful revenue from Sangdong in the form of concentrate sales.
CEO Lewis Black described the production start as a milestone for Western supply security, though acknowledged that typical ramp-up hurdles lie ahead. The priority now is turning the $68 million ore stockpile into marketable concentrate efficiently, proving that Sangdong can deliver on its potential as a genuine alternative to Chinese tungsten supply. The technology risk has been retired; the execution risk remains.
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