THE CARBIDE CRISIS

Feb 6
6 min read

Advanced formal written notice of tungsten, cobalt and APT industry disruption.

Please note - this document has not been written or edited with any AI input.

For clarity & initial context - This document is not a “price increase letter” it’s a fore-warning to our partners and customers of unprecedented and never before scale and importance.

In January 2026 Renovo implemented its first ever price adjustment since its founding in 2018. This purely covered (part) of the increase we have seen in our main production material tungsten carbide. Nothing else. An average of around 9%.

Regardless of every other industry factorial increase, including but not limited to, covid, Ukraine invasion and subsequent energy crisis where KWH usage rose from 0.10p to £1.00 per kWh consumed, inflation & climbing interest rates, weakening £, geopolitical disruption, wage, PAYE & NI increases and rates increases - Renovo absorbed these increases

becoming more operational efficient to offset these uncontrollable Macro problems.

Most recently - the USA have implemented excess global tariffs on large tungsten exporters such as China - which has had major implications to cutting tool producers and due to recently instability in global bond markets, where country’s are securing against hard assets rather than bonds or currency there has been a bull run on just about every hard physical ore and mineral.

The last point most important to the context of this document.

During 2025 Renovo watched and absorbed the increase of Tungsten powder, APT and cobalt with an over 400% increase from January 2025 to December 2025. Tungsten and cobalt are used in just about every product globally and with most relevance in the exponential growth of data centres to power AI, batteries for EV cars and various decarbonisation products being driven to push “nett zero”. During 2026 the materials which make up 60/70% of the cost of a “cutting tool or insert” have increased to date nearly 500%. Worse than that, China (who has claim to) and (has capacity to process) 87% of the global tungsten reserves - it’s restricting its mining and export quota’s to the rest of the world.

This is a serious issue.

This problem has only occurred once before, during world war 2. This is where HSSE was created for cutting tools, due to the scares supply In wolfram supply (WC) (carbide) due to the same factors impacting carbide today, diplomatic conflict. See appendix for information.

Renovo is very close to the start of the supply chain partnering with ore mining companies and has watched and reacted to a total change in trading activity, mindset, stock holding and order processing from both partners and suppliers as they try to navigate this them self. These are unknown and unprecedented grounds for everyone in cutting tools. Even the largest stock holders globally of tungsten are running out, and are not allowing what is being referred to as now “speculative orders” which historically would have been called ordering for stock, or at worse a “call off order”.

Major players in the cutting tool industry (we won’t name, names - you will likely deal with them all in your top 5 suppliers are currently buying tungsten at ANY cost. Global players are bulk ordering tungsten supplies not knowing how much the landed cost will be. I will discuss this point later.

Renovo has secured 6/12 months supply at the best 2025 pricing with a further extension of 6 months worth of increased price raw material as we HOPE industry will reach a new normal and supply will level. We can’t predict the future and anymore than a year would also damage our business from a cash flow perspective. We will review our pricing along with our stocks again in June.

What we are now seeing in Europe and the most close to home in the UK is a 4/6 month lag where the impacts what we have been watching very closely in China for and on the other side of the world for over a year - are just starting to be talked about now in the UK, and the problem hasn’t even been felt here yet.

We are seeing social media (just this week) but now daily - from many just playing catch up “increase in carbide costs, start to regrind” recycling initiatives and the price of carbide scrap 3 to 4 times than it’s ever been in the last 30 years (if not forever). This is also a major problem and talking point discussed later.

If suppliers and producers are reacting to the issue now, unfortunately may already too late to avoid. For further context, we have recently saw a single piece of 16mmx92mm rod increase from approx.. £30gbp to £139 GBP.

As the ore of tungsten is becoming far more costly, recycling is at the forefront of conversation, although this is great. It’s also causing a huge problem. (We don’t think anyone has thought about this) Recycled carbide can only physically make up a small proportion of a new cutting tool, yet by recycling a used tool - the opportunity for regrinding is removed yet the impact back into the process is small. So the carbide issue is amplified, consumers don’t have any tools. They have recycled them, yet the new tools they need will be £££%? More than initial purchased in the first place.

Major producers around the world have been making products without knowing the actual profit margin, what’s going to happen are numerous staged price increases as those companies work out how good or bad they have done, (this started at the back end of 2025) ultimately - the raw material which makes up approx. 60% of a tool has increased 500% so il let you work out which way pricing is going.

Soon, we believe there won’t be any “cheap” brands or cutting tools. The raw material was always one of the main drivers what could create this “cheap” tool. Yes, energy, labour costs were important - but material costs are fixed and marginal.

Renovo has 4 solid supply chains for carbide Supplies with stocks to see us and our partners at current levels into what we hope will be 6 to 8 months stability levels.

Tooling costs once only made up a small fraction of a manufacturing monthly bill, around 6%. We belive this is going to change, and have analysed this is going to change so dramatically that the implementation of 1 hit tools, correct speeds and feeds and application support is going to be more critical than ever

We have also been researching, developing and testing alternative materials to tungsten with very positive initial results. We believe we will be a first to market with a tungsten alternative, which we hope to roll out in the next month or two, we need to fully re-configure our machines and as with everything invest further to out manoeuvre the issues we face.

It goes without saying that reprocessing / Renew and regrinding of cutting tools will be critical to part manufacturing end users and to us our own terminology not only increase your bottom line, but stop it from going down. Renovo is equipped with a large capacity of automated ANCA machines to support when the influx of tools arrive for ReNew in the coming months.

We stress our customers to work closer with their current supply chain (not necessarily just Renovo, we mean all suppliers and partners) as any change will be short lived and counter productive to on-going supply and relationships. Working as a collective through these unknown times is critical. Pricing will actually not be the most important commodity, having stock and not running out will be.

Renovo has and does pride its self on locality, turn around, low costs, longevity, long term relationships, partnership and high quality tools. We will not sacrifice any of these due to more global uncontrollable volatile & short term factors and issues.

We hope the above information is useful and will allow you to plan ahead with your own business. We hope you can understand all points above and as our adjustments are minimal and shared between us and our sold products, we hope this has no effect on you if kindly distribute our products to your customers, if you want us to speak to any consuming end users we would be happy to discuss the current global issues facing every cutting tools producer, if you are a part manufacturer and would like to understand this in more detail

My email is antony.gray@renovosolutions.co.uk

Mobile is always on: 07717843769

Please see appendix for relating information which may be of interest: