Almonty Begins Commercial Tungsten Output at Sangdong, but Convertible Bond Overhang and Commodity Headwinds Cap the Rally
Published on 07/07/2026 at 22:41 | Redaktion boerse-global.de
Almonty Industries has crossed the threshold from developer to producer, starting commercial processing of stockpiled ore at its Sangdong mine in South Korea's Gangwon province on July 1, 2026. Yet the share price has done the opposite of what a production milestone typically delivers: it has fallen sharply, shedding 5.04 percent in a single session to C$21.85 and extending a month-long decline of over 6 percent.
The tension between operational progress and market skepticism stems from a trio of forces — a large convertible bond placement that overhangs the equity, a sharp correction in tungsten prices from their March peaks, and a growing technological rivalry from molybdenum in semiconductor manufacturing.
The $800 million conversion question
In June, Almonty raised approximately net proceeds of C$772.7 million through a convertible note offering. The notes carry a 2.25 percent coupon, mature in 2031, and were issued in an initial tranche of US$700 million with a greenshoe option that was fully exercised for an additional US$100 million, bringing the total to US$800 million. The conversion price was set at roughly US$27.40 per share — well above the current trading level — but the very existence of potential future dilution has weighed on near-term sentiment, particularly as the stock had already rallied more than fivefold from its 52-week low of C$4.70.
Should investors sell immediately? Or is it worth buying Almonty?
A parallel event that typically triggers passive inflows — Almonty’s inclusion in the Russell 1000 and Russell 3000 indices on June 29 — failed to arrest the slide. One week later, the stock was trading well below both its 50-day moving average of C$25.79 and its 100-day average of C$25.28. The 14-day relative strength index stands at 38.8, brushing against oversold territory.
Tungsten prices retreat from historic highs
The tungsten concentrate market is undergoing a violent correction. After hitting an all-time high of 1,050,500 yuan per standard tonne in March 2026, the price slumped to an average of 454,000 yuan by July 7 — a decline of roughly 14 percent in just a few weeks. Almonty’s Sangdong ore stockpile, which stood at approximately 139,700 tonnes at the end of the second quarter with a blended grade of around 0.25 percent tungsten trioxide, will initially feed lower-grade material through the mill as the company stabilises the new processing circuit before targeting higher grades.
Molybdenum, by contrast, has remained resilient at 607.50 yuan per kilogram, up 1.67 percent over the past month and 39.02 percent year-on-year. That stability matters because molybdenum is encroaching on tungsten’s traditional dominance in semiconductor metallisation. SK Hynix reported in June 2026 that its next-generation 375-layer 3D NAND flash memory uses molybdenum instead of tungsten, and Samsung has already deployed molybdenum in its ninth-generation V-NAND since 2024. Almonty is hedging its exposure by advancing a molybdenum project at the same Sangdong site; a June 16 update showed that roughly 37 percent of an intended 12,000 metres of drilling across 26 holes has been completed, with initial assays confirming grades consistent with historical data.
Long-term strategic case remains intact
Almonty at a turning point? This analysis reveals what investors need to know now.
Despite the near-term headwinds, the structural argument for Almonty has not weakened. Effective January 1, 2027, the U.S. Department of Defense will be barred from sourcing tungsten from China, Russia, North Korea, or Iran. Sangdong is one of the few non-Chinese deposits capable of filling that gap, and the company’s planned Phase 2 expansion aims to double production by 2027, potentially securing Almonty as much as 40 percent of the ex-China global tungsten supply.
On a 12-month basis, the shares are still up 193.29 percent, and year-to-date gains stand at 81.63 percent — a reminder that the current pullback, though sharp at 34.48 percent from the April 17 high of C$33.35, comes after an extraordinary rally. The stock remains 18.18 percent above its 200-day moving average of C$18.49, indicating that the longer-term trend is still intact.
The market’s focus now shifts to how quickly Sangdong can ramp throughput and deliver high-grade concentrate. The next quarterly reports will show whether tangible revenues can begin to offset the noise from convertible debt overhang, falling raw-material prices, and a semiconductor industry that is rethinking its dependence on tungsten.
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