The Sangdong metal plant in South Korea holds one of the nation’s largest single-mine metal resources. The plant is scheduled to begin operations next month after closing in the early 1990s largely due to cheaper Chinese titanium flooding global markets and undermining South Korea’s price competitiveness.
Following Canadian company Almonty Industries ‘ 2015 merger of the Sangdong mining rights, this restoration follows. The organization established a company, Almonty Korea Tungsten Corporation, to move the miners operation, which resurrected the latent webpage. Domestically, this work has been welcomed by local residents, hoping that the mine’s revival may revive the group facing local drop.
Globally, following a , visit , by US government experts this past summer, the plant is anticipated to safely provide tungsten abroad—primarily to the United States—although China remains the dominant global provider.
Given the government’s extensive dependence on Chinese metal, concerns arise in Seoul as the planet looks beyond China to find metal for manufacturing, including both for chips and batteries as well as weapons.
Sangdong Mine and the US-South Korea Tungsten Agreement
Sangdong is a small village in Yeongwol County in South Korea’s Gangwon Province. It houses the Sangdong metal me, which contains an estimated , 7.9 million tonnes , of proven and possible resources and boasts the nation’s highest levels of metal.
Almonty , claims , that the plant may run for” 100-plus times”, comparing Sangdong to its “equal size” me in Portugal, which has been running for 136 centuries and is expected to continue for another 50 to 60 years. The Sangdong mine used to contribute to , over half of the country’s exports , as one of the largest tungsten producers on the planet.
However, the mine shut down in 1994, mainly due to an influx of cheaper tungsten from China, which , resumed exporting to the non-communist world , following its , economic reforms.  , Consequently, Sangdong—once the heart of South Korea’s industrialization, generating tungsten dollars —has become nearly a ghost town, with its population dwindling to around 1, 000 residents, one of the least populated towns in the country.
The mine was originally owned by the South Korean state enterprise, Korea Tungsten Mining Company (KTMC), founded in 1952 during the Korean War. Its establishment came after the US-South Korea tungsten agreement, which was signed the same year, as the metal started to become a “pivotal strategic mineral in the 20th century.”
According to a , study  , on South Korea’s tungsten exports and the bilateral tungsten agreement, the United States classified tungsten as a strategic material for weapons production during World War II and sought alternative sources after China’s Communist Revolution, turning to South Korea.
During the Korean War, efforts to export Korean tungsten to the US grew more rapid, which sparked South Korea’s “tungsten mania” and prompted the US Department of the Interior ( DOI ) to send US experts to work with the South Korean government to stockpile tungsten from the Sangdong mine.
The United States , agreed to , “purchase all the tungsten offered by the ROK” and pay US$ 65 a ton for the first two years, with the contract lasting five years or until 15, 000 short tons of tungsten had been purchased. This agreement established a stable market for Korean tungsten exports and ensured steady and exclusive tungsten supplies for the US during the war.
However, a sharp drop in global tungsten prices, coupled with South Korea’s early meeting of the production target, led to the agreement’s conclusion. The Korean government , pushed hard , to continue the deal to maintain a steady revenue, which was crucial for its post-war recovery, but the contract was not renewed.
After decades of industry setbacks, influenced by unstable global tungsten prices and, notably, China’s aggressive pricing and exports, KTMC was  , privatized in 1994 , under the Kim Yong-sam administration’s policy to divest state-owned enterprises, becoming the first company in the country to undergo this transition.
The company was sold to the South Korean Geopyung Group, but it went , bankrupt , in 1998 during the Asian Financial Crisis. Before Canadian tungsten mining and processing company Almonty Industries acquired the business in 2015, the ownership of the Sangdong mine had been changed several times.
As of July 2024, the company has invested nearly , 130 billion won ( approximately US$ 94 million ) into the mine’s redevelopment.
Reducing Reliance on Chinese Critical Minerals ,
Tungsten is , most notably used in , semiconductors, electric vehicle batteries, automobiles, weapons, and industrial cutting machines due to its exceptional hardness and high energy density.
According to the , US Geological Survey data, China accounted for over 80 percent of the world’s tungsten production in 2023, reaching 63, 000 metric tons, followed by Vietnam, the second-largest producer, with 3, 500 metric tons. In response to China’s dominance in tungsten production and export, the US DOI , designated , tungsten as a critical mineral in 2018.
On the legislative front, the Restoring Essential Energy and Security Holdings Onshore for Rare Earths Act of 2022, or the , REEshore Act of 2022, was introduced to reduce US dependence on foreign sources, particularly China, for critical minerals like tungsten.
By 2026, the law requires the DOD and DOI to establish a strategic reserve of rare earth metals that have been processed or refined in China in sensitive US Department of Defense ( DOD ) systems. This May, the DOD issued a , final rule , restricting the acquisition of certain metals and magnets, including tungsten, from China, along with Iran, Russia, and North Korea, effective January 2027.
On tariffs, the United States Trade Representative ( USTR ) announced its plans to impose a , 25 % tariff , on Chinese minerals, including tungsten, stating that” the concentration of critical minerals mining and refining capacity in China leaves our]US] supply chains vulnerable and puts our]US] national security and clean energy goals at risk”.
Given China’s history of using critical mineral exports as a tactical tool—most recently with export controls on , germanium and gallium , effective August 2023, followed by , antimony starting September 2024—global efforts to diversify critical mineral supply chains, including tungsten, have become increasingly urgent.
In February 2023, Seoul announced a , strategic mineral procurement strategy, which selected 33 critical minerals, including tungsten,” for management with regard to economic security” with the goal of “mitigating its reliance on imports from a select few countries”.
In diplomatic relations, Seoul’s commitment to critical minerals was highlighted by the launch of the Korea-Africa Critical Minerals Dialogue during the first , Korea-Africa Summit, focusing on cooperation between Korea’s advanced technology and Africa’s mineral resources.
South Korea also signed a , memorandum of understanding , ( MOU) with Canada to strengthen critical mineral supply chains, aiming to reduce reliance on China by leveraging Canada’s mineral wealth and South Korea’s manufacturing capabilities.
In addition, Seoul assumed the , chairmanship , of the US-led Minerals Security Partnership ( MSP), and at its first MSP meeting as chair in September,  , Foreign Minister Cho Tae-yul spotlighted the Mahenge Graphite Project in Tanzania, for which Korea leads the Working Group.
South Korea’s Autonomy over Tungsten  ,  ,  ,  ,
South Korea is confronted by the unfortunate reality of having limited control over a large number of locally mined, high-quality tungsten reserves in spite of this. As the , world’s largest tungsten consumer per capita, South Korea ‘s , 95 %  , reliance on Chinese tungsten imports has been a persistent issue.
There are concerns in Seoul that the foreign ownership and operation of the Sangdong mine, which was once the nation’s greatest asset, underscores potential limitations on Korea’s autonomy over its mineral resources. Almonty intends to first allocate 45 % of its annual output to the US market and likely set aside the remaining 55 % for South Korea, which indicates a positive shift for South Korea to significantly reduce its dependence on China.
These concerns about tungsten autonomy and ownership are closely related to broader concerns about economic sovereignty and national security, especially given Seoul’s position as a semiconductor and battery manufacturing powerhouse, combined with the upcoming US presidential election and its potential impact on global trade.
Such concerns clearly demonstrate the need for long-term investment in domestic mineral resource development, extending beyond immediate profitability considerations. This includes constructing processing facilities, such as the Almonty and Yeongwol County MOU signed this year, known as the , tungsten oxide plant.
This development is particularly noteworthy because, in 2022 and 2023, Russia and North Korea were ranked as the third and fourth-largest tungsten producers, which presents a challenge for the United States and its key allies, particularly South Korea.
In the face of the growing US-China competition, tungsten is once more crucial for securing technological advancements and strengthening security initiatives, just as it was crucial during World War II, reflecting the geopolitical dynamics of that time. In today’s changing environment, the question of Korea’s ability to exercise control and maintain a stable supply chain for this crucial metal is receiving renewed scrutiny.
Haeyoon Kim is a Non-Resident Fellow at the Korea Economic Institute.  , The views expressed here are the author’s alone. Republished with permission, read the original here.