Circuit board and substrate makers outside China face higher drilling costs and a pull toward Chinese tool suppliers, while Topoint plans to double its drill capacity by 2028.
China’s controls on tungsten exports have reached one of the smallest parts in an AI server: the micro drill bits that bore the tiny connecting holes in printed circuit boards and chip substrates. Nikkei Asia reported on November 5 that the curbs have disrupted supplies of these bits, which are made mainly from tungsten carbide, and that refiners in Japan, Taiwan, the US and Europe have been affected. Drill bit prices have risen severalfold this year, according to the report.
Ammonium paratungstate traded above 530,000 yuan per metric ton this week, up from about 212,750 yuan in February 2025, Nikkei Asia reported, citing Shanghai Metals Market. Ammonium paratungstate, or APT, is the benchmark intermediate from which tungsten metal and carbide are made.
The report also points to a shift in who supplies the boards. A manager in the circuit board industry told Nikkei that some board makers have had to turn to Chinese drill bit makers or tungsten carbide suppliers as their Japanese, Taiwanese and European suppliers run short of material. Nikkei named Sumitomo Electric Industries, Kyocera, Mitsubishi Materials, Kennametal and Sandvik as high-end carbide suppliers, and said the micro drill specialists Union Tool of Japan and Topoint of Taiwan report strong demand alongside rising material costs.
Beijing’s licensing rules have covered tungsten carbide since early 2025
The restrictions date from February 4, 2025, when the Ministry of Commerce and the General Administration of Customs issued Announcement No. 10 of 2025, adding tungsten, tellurium, bismuth, molybdenum and indium items to export controls. According to the text carried by Xinhua, the tungsten items include APT, tungsten oxide and tungsten carbide, as well as some solid tungsten and tungsten alloys and the technical data used to make them. Exporters need a license from MOFCOM, and the Export Control List of Dual-Use Items of the People’s Republic of China (中华人民共和国两用物项出口管制清单) was updated the same day.
Beijing has since tightened the flow. In December 2025, China said only 15 companies may export tungsten in 2026 and 2027, and in February 2026 it banned dual-use exports to 20 Japanese entities it said supply Japan’s military, according to a Reuters report republished by MINING.COM. Reuters put APT in Rotterdam above US$3,000 per metric ton in late April, up more than 200% since the start of 2026.
Japan has been hit hardest. Citing Kyodo News, Taiwan’s Commercial Times reported that China’s exports of tungsten carbide and tungsten powder to Japan fell to zero from February to April 2026. Sumitomo Electric’s chief executive, Osamu Inoue, said in May that the company’s tungsten purchases from China had stopped completely; about 30% of its raw material had long come from China. While it sought alternative supply in the US, it raised some product prices by as much as 60%. Mitsubishi Materials priced new orders for tungsten-based hard materials from June at more than three times their earlier level, the paper said.
Topoint has passed on costs while demand keeps climbing
Taiwan’s Topoint offers the clearest view of how a supplier is handling both sides of the squeeze. The company told Cnyes that rising tungsten costs are a headwind, offset by price increases earlier in 2026, and that it has no plans for further increases in the second half. DIGITIMES reported in February that Topoint was preparing a second price rise for the first quarter, starting with uncoated tungsten carbide drills and extending to high-end coated products.
Demand has kept growing regardless. Topoint posted record September revenue of NT$830 million, and nine-month revenue of NT$5.496 billion already exceeds any previous full year, Cnyes reported. High-end coated drills rose to 56% of its product mix in the first half, and its first-half gross margin was 39.58%.
Capacity is coming, but it still needs the metal
Topoint has just raised NT$1.552 billion through a cash share offering at NT$388 per share, with the new shares due to list on November 6, plus about NT$652 million from convertible bonds. It plans monthly capacity of 45 million drills by the end of 2026, 70 million by the end of 2027 and 90 million by the end of 2028. That expansion depends on carbide supply that still needs Chinese export licenses, while Chinese rivals gain ground. Nikkei said Guangdong Dtech Technology and Shenzhen Jinzhou Precision Technology have won market share with cheaper tungsten, and Dtech’s July–September sales rose nearly 180%. A drill bit executive told Nikkei that APT costs 500,000 to 600,000 yuan per metric ton in China but could cost three times as much outside it. Watch whether MOFCOM grants more tungsten export licenses to Japanese and Taiwanese refiners, or whether more board makers follow the shift to Chinese drill suppliers that Nikkei described.