Huaxi: The Bakuta tungsten mine is expected to commence commercial production in the second quarter, making a significant contribution to the global increase in tungsten supply.

Huaxi releases research report stating that since the beginning of 2025, the price of tungsten has continued to remain high. According to SMM data, as of April 23rd, the average price of black tungsten concentrate (65%) was 146,000 yuan per metric ton, reaching a historical high. Jiaxin International plans to operate in two phases in the Bakuta Tungsten Mine project, with commercial production of Phase 1 expected to begin in the second quarter of 2025. The target mining and processing capacity for Phase 1 is 3.3 million tons of tungsten ore or 10,000 tons per day. According to Jiaxin International's production plan for Bakuta Tungsten Mine, the expected tungsten concentrate production for 2025 is 5,979 tons, accounting for approximately 6% of the global expected tungsten production. Key points from Huaxi include: - Bakuta Tungsten Mine has good resource endowment and favorable mining conditions. - Bakuta Tungsten Mine is expected to contribute 13% of global production after the second phase is put into operation. - China's dominance in global tungsten supply is expected to be sustained. Investment recommendations Since the beginning of 2025, the price of tungsten has remained high. Looking ahead, while there is new overseas supply, it will take time to materialize, and the current tight supply situation is expected to support tungsten prices. However, sluggish downstream demand may suppress market performance. Beneficiaries include Chongyi Zhangyuan Tungsten (002378.SZ) and China Tungsten and High-tech Materials (000657.SZ).Purchase the total equity of Hunan Shizhuyuan Nonferrous Metals Co., Ltd. held by Xiamen Tungsten Group Co., Ltd. and Hunan Woxi Mining Investment Co., Ltd. by paying cash; Guangdong Xianglu Tungsten (002842.SZ): APT production in 2023 is 4,299.59 tons; Xiamen Tungsten (600549.SH): APT production in 2023 is 23,500 tons; CMOC Group Limited (603993.SH): Tungsten metal production in 2024 is expected to increase by 3.92% year-on-year to 8,288 tons.Risk warning 1) Unexpected changes in upstream supply; 2) Downstream consumption lower than expected; 3) Changes in industrial policies; 4) Unexpected changes in US-China trade friction.