Geostrategic Raw Materials Alliance: Export Controls Hit SpaceX and Rheinmetall – Wall Street Bets on Almonty

SpaceX: Vertical Integration and an Insatiable Hunger for Raw Materials

The space company SpaceX, led by Elon Musk, is poised to make the largest initial public offering (IPO) in history, aiming for a valuation of up to USD 1.75 trillion. The deeply vertically integrated business model is divided into the core areas of launch services, satellite-based broadband communication via Starlink, and the merger with Musk's AI company xAI—completed just this past February—to install data centers in space. For the engines and heat shields of its Starship fleet, SpaceX requires alloys capable of withstanding extreme heat. Potential fusion reactors also require tungsten, which is the preferred material for the divertors in these power plants. Beyond raw material needs, SpaceX is facing headwinds from another direction: the US shareholder association, the Council of Institutional Investors, is criticizing the planned dual-class stock structure ahead of the IPO, as Elon Musk will control approximately 85% of the voting rights through Class B shares, effectively denying common shareholders any say.

Rheinmetall: Scaling Up Ammunition Production and Full Order Books

Rheinmetall is scaling up its European tank and ammunition production to record levels. The reason is the enormous demand. In the first quarter of fiscal year 2026, the order backlog reached a whopping EUR 73 billion. Group revenue grew by 8% to EUR 1.94 billion during the same period, falling short of expectations, while operating profit rose disproportionately by 17% to EUR 224 million. To secure this historic growth trajectory, the Supervisory Board expanded the executive team under Armin Papperger as early as the beginning of 2025 by appointing Klaus Neumann as CFO and René Gansauge as Chief Operations Officer. On the Frankfurt Stock Exchange, the stock recently consolidated at a market capitalization of around EUR 55.5 billion, which Morningstar Europe analysts classify as fundamentally undervalued given the intact growth trajectory. Doubts remain, however. Rheinmetall needs raw materials to fulfill existing orders.

Almonty: The Sangdong Monopoly and Convertible Bond Arbitrage

Almonty Industries, a commodities company active in the tungsten sector for many years, focuses on optimizing tungsten assets in politically stable countries in the Western Hemisphere. Even more than with other raw materials, tungsten depends heavily on expertise. This is where Almonty, which already managed to hold its ground against Chinese dumping competition back in the 2010s, can leverage its advantage. With the start of production at the historic Sangdong Mine in South Korea in recent months, Almonty has successfully turned the largest known tungsten deposit outside of China into a cash cow and secured a strategic monopoly through a 15-year inflation-protected off-take agreement with the Plansee Group. The proven and probable reserves of the Sangdong mine amount to 7,896 kt of ore with a grade of 0.47% tungsten trioxide, while the inferred resources total a massive 52,765 kt.

According to historical calculations, the all-in sustaining costs for Sangdong amount to just USD 110 per MTU, which is roughly half of Chinese production costs and guarantees an excellent margin at current market prices of over USD 3,000 per MTU. The crushed ore is processed using state-of-the-art mills from Metso, which are calibrated to a precision tolerance of just 0.008 mm/m. The stock has recently consolidated noticeably on the exchanges. However, given the rally of the past few months, this is not yet a major setback. The announcement of a massively oversubscribed USD 700 million convertible bond recently triggered short selling by institutional arbitrageurs, providing Almonty with net proceeds of approximately USD 675.9 million after fees—of which about USD 83 million is allocated to capped call hedges to limit dilution, leaving approximately USD 593 million available for operational purposes and strategic growth. The company plans to use this capital to repay expensive loans and continue growing. In addition to further mining projects, deeper vertical integration is also conceivable. If Almonty can use the fresh capital to acquire more market share and margin, current prices could even offer a promising outlook.

Almonty: Additional Tungsten Mines and Molybdenum Exploration

In addition to the South Korean tungsten deposits, Almonty's portfolio includes the Panasqueira mine in Portugal as well as the currently inactive Los Santos and Valtreixal projects in Spain. In the US, the company also acquired the Gentung Browns Lake project last fall, which is scheduled to enter production in phases starting at the end of this year. In September 2025, the company also launched a major diamond drilling campaign covering 11,700 m in the Sangdong underground area to verify the high-grade molybdenum deposits in the Alfonse D zone. For this division, Almonty has already signed an exclusive off-take agreement for the entire life of the mine with South Korea's SeAH M&S—a direct supplier to SpaceX—at a guaranteed minimum price of USD 19.00 per pound of molybdenum oxide.

Conclusion: An Ideal Starting Position for the De Facto Monopolist

Almonty has close ties to Western industry. This is evident from its off-take agreements and its ownership structure—the Austrian company Plansee is among its shareholders and repeatedly highlights its collaboration with Almonty in interviews. The fact that KfW-IPEX Bank is among the financing partners and that retired US General Steven L. Allen has joined the management team as the new Chief Operations Officer further underscores the company's strong position. In times when tungsten is in short supply and urgently needed by many industries, Almonty is the go-to supplier. The already enormous margins are likely to grow further. Almonty remains a unique success story.