When returns meet security: Why Almonty Industries is suddenly everyone's darling!

Tungsten: The invisible backbone of security

Tungsten is not a headline-grabbing commodity, but without it, nothing works. Its melting point of 3,422 degrees Celsius makes it the hardest metal on earth and indispensable in defense technology. Industry experts agree that without tungsten, there would be no hard steel for armor or high-impact ammunition. The problem is that over 80% of global production is controlled by China. Since Beijing drastically cut exports in February 2025, NATO countries have been desperately searching for alternatives. According to estimates, Western reserves will only last for a few months – a nightmare for defense companies that want to ramp up production due to the boom.

Almonty Industries: From underdog to strategic partner

This is where Almonty Industries comes into play. The Company, which previously operated mines in Portugal and Spain, is positioning itself as a bridgehead for Western raw material security. The game changer is the Sangdong mine in South Korea. A historic mine dating back to the 1950s, which once supplied 30% of the world's tungsten. After more than three decades of inactivity, Almonty will start production here in the second quarter of 2025. The figures are impressive. The property offers 7.89 million tons of ore reserves, a life span of 90 years, and has the potential to cover more than 40% of non-Chinese production.

Another deal that changes everything

On May 7, Almonty signed an agreement underscoring the Company's strategic importance. Tungsten Parts Wyoming, a US defense contractor, has committed to purchasing at least 40 tons of tungsten oxide per month, which will be used exclusively for US defense applications such as missiles and drones. The highlight of the deal is a guaranteed minimum price combined with unlimited upside potential as global market prices rise. "This binding purchase agreement represents a significant milestone for Almonty, as it secures both predictable revenue through a fixed minimum price and long-term demand directly linked to US defense programs," said CEO Lewis Black. The deal is not an isolated case. The Austrian Plansee Group secured long-term supplies back in 2020. At the end of January, it was announced that South Korean steel giant SeAH M&S would purchase all molybdenum from Sangdong, which is also located on the property.

The "Americanization" of a Canadian company

Parallel to its operational expansion, Almonty is undergoing a structural change. At the most recent annual general meeting, a majority of shareholders voted in favor of relocating the headquarters to Delaware. This brings the Company closer to the US military complex. This is in line with the announcement on March 18 that the Company has entered into a strategic partnership with American Defense International, which has important networks in the US. The strategy is complemented by the planned listing on the NASDAQ, which is intended to attract new investor groups. The appointment of retired General Gustave F. Perna to the board was a symbolic coup. The former head of logistics for the US Army brings contacts in the Pentagon and knows how to make supply chains crisis-proof.

Analysts: From niche player to mainstream player

The financial world is beginning to recognize the potential. Peter Thilo Hasler of Sphene Capital sees the Company generating revenue of CAD 483.4 million and EBIT of CAD 198.8 million by 2027. His price target is CAD 5.40. GBC Research is more cautious at CAD 4.20, but points to the unique geopolitical leverage. Also in April, B. Riley Securities issued a "Buy" recommendation with a target price of CAD 5.00. This puts the stock's potential between 70 and 120%.

But it is about more than just numbers. Almonty embodies a paradigm shift. Countries are suddenly prioritizing security of supply over cost efficiency. This plays into the Company's hands. Demand already exceeds supply, and Almonty is one of the few players outside China that can scale up. Nevertheless, it is not possible to meet all the demand. Lewis Black said in an interview with FAZ: "I realize that I have to tell many interested parties that I unfortunately cannot supply them immediately."

In a world that is moving toward division rather than globalization, tungsten is becoming a test case for Western resilience. Almonty Industries has set the course to fill this gap with the Sangdong mine, strategic alliances, and US domestication. Whether the mine will become the key to the West's tungsten supply also depends on the broader geopolitical climate. But one thing is clear: When security takes precedence over returns, companies like Almonty are no longer just commodity stocks – they become insurance policies against the unpredictability of the 21st century.