Companies · · 2 min read
Editor: Bohdan S.
CME Group to launch tungsten futures as demand for weapons metal grows
The exchange operator plans a futures contract for a $20bn critical mineral used in munitions and chip technology, giving buyers a way to lock in prices from early 2027.
The short answer
CME Group said it will launch tungsten futures by early 2027, pending regulatory reviews, creating a forward price for a metal that has only a spot market today. The Financial Times (FT) linked the move to rising weapons demand and Chinese export curbs. It could help manufacturers hedge costs, and extends CME's record metals growth.
What happened
CME Group announced on Monday that it will list tungsten futures on its COMEX exchange, with trading set to start by early in the first quarter of 2027 if regulators sign off. The contracts will be settled in cash against a Fastmarkets price assessment for ammonium paratungstate, a refined form of tungsten, delivered to Rotterdam and Baltimore. According to the Financial Times (FT), the plan comes as demand for the metal in weapons rises, and after China restricted exports of tungsten, which is used in armor-piercing munitions. CME said its metals trading hit a record in the first nine months of 2026.
What it means
Tungsten is a metal most people never see, but it feeds into advanced manufacturing, semiconductor technology and military hardware such as armor-piercing munitions. CME says the global market produces 85,000 to 95,000 metric tons a year and is worth more than $20 billion at current spot prices. The US, the European Union, Japan and India all list it as a critical mineral.
Until now, buyers and sellers have traded tungsten only on the spot market, meaning deals for immediate delivery at today's price. A futures contract lets a company agree a price now for a later date. That matters for a manufacturer that needs tungsten every month but cannot predict what it will cost. One metals trader said in CME's release that clients have struggled to budget without a forward market.
The timing reflects a wider scramble for secure supplies of critical minerals. When one country dominates supply and restricts exports, prices can jump and become hard to forecast, which raises demand for hedging tools. CME's metals head, Jin Hennig, said tungsten sits "at the intersection of advanced manufacturing, semiconductor technologies and geopolitics."
For CME, it is another product in a fast-growing business. Its metals division averaged 1.2 million contracts a day in the first nine months of 2026, up 41% from a year earlier. New contracts do not always attract enough trading to succeed, though, and this one still needs regulatory approval.
The bull case
A transparent forward price could draw manufacturers, traders and defense suppliers that now have no way to hedge, making tungsten easier to finance and budget for. For CME, it adds to a metals business already growing at a record pace, and critical minerals are a theme governments are pushing. Better price discovery could also support investment in new supply outside China.
The bear case
Tungsten is a small, specialized market, and many new futures contracts struggle to build enough trading to matter. Launch depends on regulatory reviews, and if Chinese export policy shifts suddenly, prices may swing in ways that make the benchmark hard to use. For CME's earnings, one niche contract is unlikely to move the needle soon.
Why it matters
For investors
CME Group gains another product in a fast-growing metals division, while tungsten miners and users such as manufacturers and defense suppliers could gain a clearer price signal. The broader critical-minerals trade remains tied to Chinese export policy.
The wider context
Many everyday products, from phones to cars, depend on metals with concentrated supply chains. Tools that make their prices more transparent can, over time, help companies manage costs that would otherwise be passed on to consumers.
Market impact
| Asset (ticker) | Possible move | Timeframe | Why |
|---|---|---|---|
| CME Group (CME) | ↑ Up | Long term | Adds a new contract to a metals business growing at a record pace. |
| VanEck Rare Earth and Strategic Metals ETF (REMX) | ↔ Unclear | Short term | Highlights critical-mineral demand, but futures trading is months away. |
The FinPrism newsroom's view of how these figures could move, as of . It is general news commentary, not a recommendation to buy, sell or hold anything.
Frequently asked questions
What is CME's new tungsten futures contract?
It is a cash-settled futures contract on COMEX that tracks a Fastmarkets price for ammonium paratungstate, a refined form of tungsten, delivered to Rotterdam and Baltimore. CME Group expects trading to begin by early in the first quarter of 2027, pending regulatory reviews.
What is tungsten used for?
Tungsten is a metal used in advanced manufacturing, semiconductor technology and military hardware, including armor-piercing munitions, according to CME Group and the Financial Times. The US, the European Union, Japan and India classify it as a critical mineral, and global production is 85,000 to 95,000 metric tons a year.
Why does tungsten need a futures market?
Tungsten trades only on a spot market today, so companies cannot lock in future prices. A futures contract lets producers and users hedge against price swings. That has become more important as China restricted exports of the metal, according to the Financial Times.
Sources: CME Group, Financial Times
How this was made: written with AI assistance from the sources listed above, following our editorial standards.
