The logistics of getting tungsten from China to Germany in a world at war would be quite horrific though, I suppose.
That's a good point. This decision was made, however, more than a full year before war broke out. Granted, Hitler intended to go to war only six months later, in October 1938. Logic would dictate, however, that Germany should strive to get as much tungsten - as well as other materials that Germany received from the
Kuomintang, such as wolfram, although tungsten was by far the most important part of that trade - as possible before the outbreak of war. Especially as the trade was on hugely favourable terms for the Nazis; China was so desperate for military assistance that Germany paid most of its trade balance with WWI rifles and a few dozen military instructors.
Ribbentrop argued that Japan occupied so much of China that the vital materials could be purchased from them, but this ignored the salient points that Japan was able to request a much higher price for those goods than China would have, and, more importantly, that Japan was an industrialised state in its own right, and needed those resources itself; Japan ran a mercantilist policy in its occupied territories, kicking out foreign companies - even German ones - and monopolising the resources there for their own military build-up.
Ribbentrop's argument, as Goering pointed out, was fallacious anyway; Japan didn't control the western provinces of China, which is where the tungsten came from. This made Ribbentrop's argument about as intelligent as claiming one should abandon an alliance with Saudi Arabia for an alliance with Ethiopia in order to control the Saudi oil supply.
