Tungsten’s Strategic Urgency Fuels Almonty’s $800 Million Convertible and Russell Index Ascent
Published on 06/16/2026 at 19:22 | Redaktion boerse-global.de
China’s stranglehold on tungsten has turned a once-obscure metal into the central nervous system of Western defense manufacturing. After Beijing imposed export licenses for ammonium paratungstate in February 2025, overseas shipments of the raw material collapsed by roughly 70% last year. The result is a scramble for supply that plays directly into the hands of Almonty Industries, the only non-Chinese producer now ramping up to scale.
The company closed a convertible bond offering worth $800 million last week, a deal that was heavily oversubscribed. After fees, Almonty will pocket approximately $773 million. The notes carry a 2.25% coupon, and management exercised the full overallotment option. Institutional appetite for the paper was so strong that the issuer had no trouble filling it. The proceeds will be used to refinance existing debt, fund capped-call transactions to limit shareholder dilution, and bolster working capital for the operational ramp-up.
That ramp-up is centered on the Sangdong mine in South Korea, which began production in March and is expected to deliver first operational data in June. The initial development phase should hit full capacity by July, and plans to double output are already being drafted. Once fully loaded, Sangdong will account for more than 80% of the world’s tungsten output outside China. The timing aligns neatly with the Pentagon’s directive to eliminate imports from hostile nations by 2027 — a deadline that is fast approaching for an industry that still depends on Chinese material for key components in armor-piercing ammunition, missile guidance systems, and high-performance semiconductors.
Should investors sell immediately? Or is it worth buying Almonty?
Almonty has also taken steps to look the part of a trusted Western supplier. The company moved its corporate headquarters from Toronto to Montana, and shareholders at the annual meeting approved the addition of two retired U.S. generals to the board: Gustave F. Perna and Alan Estevez, each receiving over 99% of the vote. Their presence sends a clear signal to military procurement officials that Almonty speaks their language. Meanwhile, the acquisition of the Gentung project — a brownfield deposit that will use upgraded machinery from Almonty’s Spanish operations — is on track to start production by the end of 2026, cutting development costs substantially.
On the capital markets front, a structural catalyst is imminent. At the end of June, Almonty will join both the Russell 1000 and Russell 3000 indexes. Index funds and ETFs tracking those benchmarks will be forced to buy the stock, and estimates suggest demand for roughly 13 million shares — equivalent to three times the average daily trading volume. Historically, such index adjustments generate heavy volume in the weeks before the reconstitution date and lead to permanent improvements in liquidity, analyst coverage, and institutional ownership.
The stock has already responded to the narrative. Trading at C$25.44 on the Toronto exchange, Almonty has gained about 111% since the start of the year, recovering from earlier dilution fears. That puts the 52-week high of C$33 within striking distance, assuming the index-driven buying pressure materializes as expected. Analysts are taking note: Oppenheimer recently raised its price target to $25 — in U.S. dollars, implying further upside from current levels — and reiterated a buy recommendation.
The pattern mirrors the rare-earth supply shock of the 2010s, when China’s export restrictions sent Western governments into a multiyear panic. New mines typically need at least 24 months to reach production; Almonty has already crossed that threshold. With Sangdong generating cash flow, an oversubscribed convertible in the bank, and a board that speaks directly to the Pentagon’s needs, the company now faces the simplest task of all: delivering on schedule.
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