China has tradtionally been the world's leading tungsten producer, accounting for 85% of the world's production, estimated at 35 000 t of tungsten concentrate. China's tungsten production does not seem to be affected by the slump in global pruices as production remains at about 70% capacity. This compares to 10% production capacity exhibited by western producers. China's wolframite reserves are being rapidly depleted with an estimated 12 years reserves or 600 000 t remaining. Although China has substantial scheelite resources, they are of a much lower grade and quality.

The government exerts much control over the production of tugsten and in January 2004 the Ministry of Land and Resources ste the total allowable production quota of tungsten concentrate for the year at 43,660 t but the output in 2003 was more at 67,326 t, a 3.4% increase from 2002. Rapid development of the automotive machinery manufacturing, construction metals and communications industries increased domestic demand for tungsten, with 2003 consumption totalling an estimated 80,000 t. Exports of tungsten ore increased by 29% in 2003 to 32,987 t (US$220 million) and imports imports by 40% (US$33.7 million).

Jiangxi Tungsten Group Ltd which was formed in December 2003 has become the largest tungsten group in China. It is a joint venture between Jiangxi Rare Earth Metals Tugsten Group (The largest precious and rare metals group in China) and China Five Minerals Non-Ferrous Metals Ltd (the largest sales company in China).