Almonty Wins Sandvik Offtake for Spanish Tailings as DA Davidson Stays Bullish on African Expansion
Published on 09/18/2026 at 06:20 | Editorial boerse-global.de
Almonty Industries has moved on two fronts in less than a week, locking in a European customer for its idle Spanish tailings while cementing a government-backed venture in Rwanda — a pair of developments that has done little to close the gap between analyst optimism and a cautious market.
The Canadian tungsten producer signed a long-term supply agreement with Wolfram Bergbau und Hütten AG, a subsidiary of Sweden's Sandvik group, covering the reprocessing of historical tailings at the Los Santos mine in western Spain, roughly 50 kilometers south of Salamanca. Structured as a take-or-pay arrangement, the deal hands Almonty a conditional advance payment of USD 3.0 million in exchange for offtake rights, with selling prices indexed to the market and protected by a guaranteed floor.
The timing speaks to a broader strategic squeeze. China controls about 80 percent of global tungsten output and tightened export controls on the industrial metal noticeably during 2025. Tungsten's hardness and heat resistance make it irreplaceable in manufacturing and defense production, and Spain holds the largest known reserves in Western Europe. CEO Lewis Black noted that the counterparty is the only integrated tungsten smelter outside Asia and Russia.
For Almonty, the contract offers a route to monetize a property that has sat in pure maintenance mode since February 2020. Investors greeted the news with a 5.4 percent gain on Thursday, sending the shares to EUR 12.37.
Metallurgical Recovery Holds the Key
What matters now is a single operational metric: the actual yield from recovering the contracted minimum of roughly 1,720 tonnes of contained tungsten trioxide from the tailings. Reprocessing old mine waste is technically demanding, requiring finely ground ore with fluctuating metal grades to be stabilized chemically and physically.
Should investors sell immediately? Or is it worth buying Almonty?
The price floor shields Almonty from a collapse in raw material markets, but margin depends entirely on the cost per tonne of concentrate produced. If engineers on site hit their target recovery rate within budget, the Spanish stockpiles become a dependable cash flow stream with predictable revenue. Should the process stumble on technical hurdles or unexpectedly heavy reagent consumption, operating costs could quickly erode the protected minimum margin. The project's success will be judged first and foremost on metallurgical recovery during the initial test runs.
Under the optimistic scenario, Los Santos broadens Almonty's revenue base within about six months, provided permits and infrastructure construction stay on schedule. Combined with the Sangdong mine in South Korea, which is back in production, and the Panasqueira mine in Portugal, the group would command multiple active sources for Western industrial customers. Guaranteed volumes and indexed pricing would then deliver a double benefit: a floor under the core business, with rising tungsten prices from continued Chinese export restrictions flowing straight through to earnings. With a market capitalization of EUR 2.74 billion, a smooth Los Santos start-up could shore up investor confidence and lift profitability across the entire portfolio.
Permits, Liabilities and a Fresh African Bet
Set against that are concrete operational and financial uncertainties. Start-up at Los Santos remains explicitly contingent on outstanding regulatory approvals and infrastructure build-out. Environmental review on the Iberian peninsula is no formality — Almonty's Valtreixal project drew a negative environmental assessment in July, and any permitting delay at Los Santos would push back the timeline for first production. The balance sheet adds its own sensitivity: convertible bonds totaling USD 700 million were reported in June 2026. If technical work slips or the USD 3.0 million advance is consumed by unforeseen project costs, the hoped-for earnings contribution would not materialize, and the company remains exposed to commodity cycles should global industrial demand weaken.
The Rwandan track has drawn a different kind of attention. DA Davidson reaffirmed its buy rating on Tuesday with a USD 33 price target, following Reuters reports that Almonty signed a binding agreement with the Rwandan government to establish the Almonty Rwanda joint venture. The state will hold a 25 percent stake in the new platform, which aims to develop tungsten deposits and process the metal locally. The project's inclusion in a U.S. economic framework agreement gives it added political weight, and Rwanda's selection underscores Almonty's ambition to establish itself as a relevant supplier beyond its traditional strongholds.
The geopolitical logic is sound, though the operational demands on infrastructure and execution are considerable. In Tuesday's session the stock recovered 5.1 percent to EUR 12.32, yet it remains far below the analysts' bullish targets — a spread that reveals how much optimism is baked into the estimates and how little of it has found its way into the market price.
Milestones Will Set the Direction
The path ahead hinges on execution. As long as permits for the western Spanish tailings facility arrive on time and the schedule for first processing phases holds, the foundation for an operational re-rating stays intact. If the timeline slips on environmental objections or infrastructure delays, the recent confidence could evaporate just as quickly.
The next concrete catalyst is the targeted start of first production in roughly six months. By spring 2027, Almonty must show hard evidence that tailings processing is underway and that contracted concentrate volumes can be delivered to its customer. Only successful shipment of the first tranches will demonstrate whether Los Santos can complete the transition from maintenance mode to a profitable production site — and whether the market's skepticism, or the analysts' conviction, proves to be the better guide.
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