Almonty Industries Inc. has announced results of an industry survey that show the significant challenges U.S.-based manufacturers face as a result of China’s dominance of the supply of strategic metals used in a number of critical products and business uses.
Almonty commissioned an online survey during the last week of June 2020, asking a series of raw material supply chain questions in front of roughly 150 business executives across industries such as construction, automotive, technology manufacturing, building products and electrical components.
According to the U.S. Geological Survey (USGS)1, China controls the market for nearly 35 precious minerals and metals that are important to the U.S. for production and manufacturing, and strategic metals like tungsten are among them. Manufacturing executives are growing concerned that China has limited the amount of tungsten exports that can be shipped to the U.S., and this has caused business challenges from the supply of these metals.
According to the recent survey, 26% of executives have had to source their strategic metals from Vietnam/Pan Asia, while 20% are sourcing from China, Mexico and South America. However, China remains a significant sourcing location for many executives. One out of five polled said they are sourcing as much as 40% of all their strategic metals from China.
“It’s a perilous time for U.S. manufacturers to be facing a constrained supply chain of precious and strategic metals that are so important to industry, business and consumer uses today,” says Lewis Black, CEO of Almonty Industries. “COVID-19 has placed unwanted economic pressure on many U.S. manufacturers, on top of the China/U.S. trade war that was already placing difficult price and financial strains on U.S. industries.”
When asked about the greatest challenges with their raw materials supply chain, most respondents (63%) said it is detrimental to their business that China controls too much of the supply.
Another 74% said the greatest threat to their manufacturing business over the next 12 months would be supply chain disruptions and constraints.
Raw materials like tungsten are used to make items such as drill bits, mining equipment, construction tools, lamps, transistors and alloys. It is one of the most durable, heat-resistant metals on earth.