When the machines grind to a halt: Why Sandvik is trembling, and Almonty Industries is becoming a billion-dollar bet like MP Materials

Sandvik: The seismograph is sounding the alarm

To understand the scope of the crisis, one must look to Stockholm. Sandvik is not just any machine manufacturer, but the global market leader for cutting tools. As the Sandvik Group's Q3 2025 Interim Report shows, demand from the aerospace and automotive industries is robust, but CEO Stefan Widing recently issued an unambiguous warning about the risks in the supply chain. Without tungsten carbide, there are no indexable inserts, and without these inserts, neither engine blocks can be milled, nor aircraft turbines turned.

Sandvik painted a bleak picture in its "What Would Happen without Mining" campaign: a halt in the supply of tungsten would paralyze large parts of global manufacturing within weeks. The research makes it clear that recycling alone cannot satisfy the industry's hunger; dependence on Chinese primary material remains the group's Achilles' heel. Sandvik is willing to pay almost any price to keep the conveyor belts running, which drastically shifts pricing power to the few remaining producers.

MP Materials as a blueprint: The value of independence

For investors, the current situation is déjà vu. When tensions between China and the US over rare earths escalated, MP Materials' stock skyrocketed. The reason was simple: MP Materials owns the Mountain Pass mine, the only relevant asset in North America that could guarantee security of supply. The market paid a massive "geopolitical premium" for independence from Beijing.

Almonty Industries is now at exactly this point on the curve. According to EU and US classifications, tungsten is even more critical than many rare earths, as it is virtually irreplaceable due to its extremely high melting point of 3,422° Celsius. While MP Materials is already valued at around USD 11 billion, Almonty is still flying under the radar with its low single-digit billion valuation, even though the Company has an asset in the Sangdong mine in South Korea that is every bit as important as the Mountain Pass mine.

For investors, the following parallel suggests itself: those who missed out on MP Materials will find in Almonty a second chance to bet on the strategic decoupling of the West.

Almonty Industries: The Sangdong monopoly

Almonty's ace in the hole is the Sangdong mine, which recently ramped up production. The geological facts presented in the NI 43-101 Technical Report are impressive. With an average grade of 0.45% WO3, the ore in Sangdong is more than twice as rich as the global average of about 0.19%. This geological advantage translates directly into an unbeatable cost structure: while the marginal costs of Chinese producers are often between USD 200 and USD 250 per MTU, Almonty will produce at Sangdong at a cash cost of around USD 110.

CEO Lewis Black, considered by industry insiders to be the most experienced tungsten manager in the West, has positioned the Company to take maximum advantage of the current price explosion. **According to current market data, tungsten in the form of APT is currently trading just below the USD 1,000 mark. At these prices, Sangdong becomes a money-making machine. Almonty thus not only offers security of supply for its customers in the defense and industrial sectors, but also an operating margin that is unparalleled in the mining sector.

Conclusion: The valuation gap must close

The facts are clear: the world needs tungsten, China is reducing supply, and companies like Sandvik have to buy at almost any price. Almonty Industries is the only player that can offer significant, new, and geopolitically secure capacities of this sought-after metal. Currently, the market is still pricing in development risks for Almonty, while it is already paying for production at MP Materials – given that Almonty has also been producing at its Panasqueira mine in Portugal for many years and the Sangdong giga mine in Korea is ramping up, the valuation difference seems too large. With each passing day, as the first production figures for Sangdong draw nearer, this risk diminishes. Investors are presented with a classic arbitrage situation here. Following the price decline in recent days, Almonty's stock appears all the more attractive.