Analysis Report on Overseas Market Expansion of Zhongwu Hi-tech

Zhongwu Hi-tech Materials Co., Ltd. (Stock Code: 000657.SZ) was founded in 1993 and listed on the Shenzhen Stock Exchange in 1996. It is the cemented carbide business platform of China Minmetals Corporation[0]. The company is mainly engaged in cemented carbide and non-ferrous metals such as tungsten, molybdenum, tantalum, niobium and their deep processing businesses, and has developed into a leading enterprise in the global cemented carbide industry.

The company occupies a pivotal position in the domestic tungsten industry:

, with a production volume of about 140 million CNC inserts, accounting for 10% of the total domestic output. The tungsten mines managed by Minmetals have proven tungsten reserves of 1.23 million tons, accounting for 11.7% of the proven tungsten resources in China[1]. The company owns core subsidiaries such as Zhuzhou Cemented Carbide Group Co., Ltd. (“Zhuzhou Cemented Carbide Group”) and Zhuzhou Diamond Cutting Tools Co., Ltd. (“Zhuzhou Diamond”). Founded in 1954, Zhuzhou Cemented Carbide Group is one of the 156 key projects constructed during the country’s “First Five-Year Plan” period, and is known as “the cradle of China’s cemented carbide industry”[2].

Relying on the resource advantages of China Minmetals Corporation, Zhongwu Hi-tech has actively implemented the “Going Global” strategy, forming a trinity layout system of “

” in overseas markets. The company’s overseas layout mainly covers three levels: upstream resource development (obtaining overseas tungsten resources through equity participation or cooperation), midstream production processing (establishing production bases for intermediate products such as tungsten oxide and tungsten powder overseas), and downstream product export (exporting high-value-added cemented carbide products to major industrial countries around the world).

• Project Investment
  : Approximately RMB 80 million
• Production Capacity
  : 1,500 tons of tungsten oxide per year
• Construction Progress
  : Completed and put into operation in May 2024[2]
• Strategic Significance
  : Utilize South Korea’s mature secondary resource recycling system to establish a tungsten oxide production base, providing stable raw material supply for downstream cemented carbide production

• Proven Ore Reserves
  : 126.03 million tons
• WO₃ Reserves
  : 285,000 tons
• Average Grade
  : 0.23%
• Designed Capacity
  : 15,000 tons of ore mining and processing per day
• Commissioning Time
  : November 2024[2]
• Strategic Significance
  : After commissioning, this mine will become one of the world’s largest single tungsten mines by production capacity, providing a stable source of tungsten raw materials for Zhongwu Hi-tech

• Project Investment
  : Approximately RMB 150 million
• Capacity Plan
  : 3,000 tons of ammonium paratungstate, 2,000 tons of tungsten powder, 1,200 tons of tungsten carbide, 400 tons of tungsten bars, and 300 tons of cemented carbide rods per year
• Implementing Entity
  : Ganzhou Haisheng Tungsten Industry Co., Ltd.
• Strategic Significance
  : Establish a production base in Southeast Asia to radiate the ASEAN market and avoid trade barriers

According to data from the China Tungsten Industry Association and the General Administration of Customs, China’s tungsten product exports in 2024 showed the following characteristics[3]:

Indicator	Value	YoY Change
Total Export Value of Tungsten Products	RMB 8.261 billion	+4%
Export Volume of Cemented Carbide Inserts	3,495 tons	+7.9%
Export Value of Coated Cemented Carbide	RMB 1.976 billion	+5.2%
Export Value of Other Cemented Carbide Inserts	RMB 747 million	+10.7%

China’s tungsten product export market was highly concentrated in 2024, with the top seven export countries accounting for 72.8% of the total[3]:

Rank	Country/Region	Export Value (RMB 100 million)	Main Products	Market Characteristics
1	Japan	15.26	Diversified	Largest importer
2	South Korea	12.53	Diversified	Secondary resource recycling base
3	Russia	9.90	Cemented carbide inserts	67% CAGR in the past 5 years
4	United States	7.49	Midstream raw materials	Affected by tariff policies
5	Netherlands	5.81	Raw materials and semi-finished products	European metal trading center
6	Germany	5.53	Finished cutting tools	EU industrial manufacturing center
7	India	4.30	Diversified products	Emerging growth market

China’s tungsten product exports are going through a critical stage of transformation from primary products to high-end products[3]:

• Export Volume of Raw Material Grade Tungsten Products
  : Decreased from 26,452 tons in 2017 to 15,572 tons in 2024, a drop of 41%
• Export Value of Cemented Carbide
  : Increased from RMB 3.293 billion in 2017 to approximately RMB 6.5 billion in 2024 (estimated)
• Unit Price of Coated Cemented Carbide Inserts
  : Increased from USD 150,000 per ton in 2020 to USD 187,200 per ton in 2024

This transformation trend reflects that leading enterprises such as Zhongwu Hi-tech are climbing up to high-value-added product fields, gradually getting rid of dependence on low-end raw material exports.

In February 2025, the Ministry of Commerce and the General Administration of Customs imposed export controls on items related to tungsten, tellurium, bismuth, molybdenum, and indium[4]. This policy has had a significant impact on overseas markets:

• APT Price in European Market
  : As of June 18, 2025, the European APT price closed at USD 430 per ton-unit, up 30.3% from the beginning of the year
• Ferrotungsten Price in European Market
  : Closed at USD 51.85 per kg, with a year-to-date increase of 17.8%
• Changes in Export Structure
  : Exports of tungsten intermediate products decreased significantly, while exports of end products increased markedly

Despite the complex international trade environment, China’s tungsten product exports still achieved growth from January to May 2025[5]:

Product Category	YoY Growth	Driving Factors
Cemented Carbide Products	Approximately 31%	Increased demand for high-end cutting tools
Drilling Machinery	Approximately 22.3%	Increased investment in mineral exploration
Coated Cemented Carbide to Russia	Significant growth	Supply chain restructuring

:

1. Trade Barrier Risks
   : U.S. tariff policies against China may lead to a decline in tungsten product exports to the U.S.
2. Supply Chain Restructuring
   : European and American countries are attempting to build a “de-China” tungsten supply chain
3. Geopolitical Risks
   : The complexity of the international situation increases the operational uncertainty of overseas projects

:

1. Accelerated Industrial Upgrading
   : Export controls force domestic enterprises to transform to high-end products
2. Emerging Market Development
   : Markets such as ASEAN and India are growing rapidly
3. Enhanced Resource Control
   : The commissioning of overseas tungsten mine projects ensures raw material supply

1. Consolidate Japanese and South Korean Markets
   : Utilize the already commissioned secondary resource base in South Korea to deepen cooperation with Japan and South Korea in high-end products
2. Develop Emerging Markets
   : Increase export efforts to emerging markets such as ASEAN and India to reduce dependence on a single market
3. Optimize Export Product Structure
   : Increase the proportion of high-value-added products such as coated cemented carbide and CNC inserts

1. Improve Overseas Production Network
   : Promote the construction of the Thailand project and establish a production and sales network covering the Asia-Pacific region
2. Strengthen Technical Cooperation
   : Carry out technical cooperation with international leading enterprises to improve high-end cutting tool manufacturing capabilities
3. Expand Application Fields
   : Develop high-end application fields such as aerospace, new energy vehicles, and semiconductor manufacturing

As a leading global cemented carbide enterprise, Zhongwu Hi-tech should take “becoming a world-class tungsten enterprise with global competitiveness” as its strategic goal, and achieve international development through four paths:

, , , and .

As the cemented carbide business platform of China Minmetals Corporation, Zhongwu Hi-tech has made significant progress in overseas market expansion. The company has built an international layout covering resource acquisition, intermediate product production, and product sales by establishing a secondary resource base in South Korea, participating in the development of the Bakuta Tungsten Mine in Kazakhstan, and planning the Thailand production project, among other measures. In terms of export markets, the company’s products are mainly exported to industrial countries such as Japan, South Korea, Russia, the United States, the Netherlands, and Germany, and the export structure is transforming from primary raw materials to high-end cemented carbide products.

Although the tungsten export control policy implemented in 2025 has impacted raw material exports in the short term, it has objectively promoted the upgrading of export product structure, creating greater development space for leading enterprises such as Zhongwu Hi-tech. Looking forward, Zhongwu Hi-tech should continue to adhere to the development strategy of “resource internationalization, production globalization, and brand internationalization”, and while consolidating its leading position in the domestic market, actively participate in global competition, and strive to build a world-class tungsten and cemented carbide industrial group.

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[0] 2024 Sustainable Development Report of China Minmetals Corporation (http://www.minmetals.com/kcxfz/zrbg/202506/P020250828681317001519.pdf)

[1] 2024 Sustainable Development Report of China Minmetals - Tungsten Industry Chain Layout (http://wap.sasac.gov.cn/n4470048/n32559362/n33126686/n33393872/n33442154/c33985487/part/34033037.pdf)

[2] 2024 Tungsten Industry Milestones - China Tungsten Industry Association (https://www.ctia.net.cn/news/tungsten/1872.html)

[3] Special Research Report on Tungsten Industry - Guosen Securities (https://pdf.dfcfw.com/pdf/H3_AP202507301718355923_1.pdf)

[4] Tungsten and Molybdenum Support Great Undertakings, Magnetic Materials Shine in Glory - In-depth Report on Xiamen Tungsten (https://pdf.dfcfw.com/pdf/H3_AP202507301718397455_1.pdf)

[5] Tungsten Market Outlook 2025 - Metal.com (https://www.metal.com/en/newscontent/103387827)