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|Following FeCr Import, China May Turn To Country To Import Molybdenum|
|= Owing To High Domestic Cost, China Is Concentrating To Purchase Overseas Moly At Lower Prices|
As far as the international price of molybdenum oxide has continued to maintain a lower level than US$10 per lb. of Mo, China will supposedly keep to be steering for imports of molybdenum from overseas sources, following their imports of ferro-chrome.|
Owing to the facts that Chinese Government has strengthened the regulations for exports of molybdenum and China has been producing molybdenum on a small scale, the cost to produce molybdenum in China is estimated to be higher than US$10 per lb. of Mo. Reflecting the current price of molybdenum oxide in overseas markets which has fallen to a lower level than US$8.00 per lb. of Mo, a particular conception of economy to prevail in China has caused to feel a substantial advantage, which it should be better for Chinese consumers to import molybdenum from overseas sources.
From December of 2008 when molybdenum prices have fallen steeply in the world market, China has taken a positive attitude toward imports of molybdenum and it was informed widely that approximately 10,000 tons of molybdenum on content base were exported from the western markets to China. Since many of convertors and traders, having held large stocks of molybdenum products, are supposed to have exported their excessive stocks to China, it seems that China has become the place to dispose of these stocks of molybdenum products at discounted prices. Nevertheless, prices of molybdenum products have been continuing to fall.
According to the customs-statistics released in China, this country imported 7,035 tons in material of molybdenum products in January - February of 2009. On the other hand, China exported 1,026 tons in material of molybdenum products in the same period. Therefore, a differential of quantities between imports and exports was remarkable. The quantities (on material base) of molybdenum products imported by China in January - February of 2009 are broken down by items as follows ; <> molybdenum oxide (roasted material) : 4,872 tons (corresponding to 5.8 million lbs. of Mo on content base), <> molybdenum sulfide (unroasted material) : 2,070 tons (corresponding to 2.19 million lbs. of Mo on content base) and <> ferro-molybdenum : 93 tons (corresponding to 131,000 lbs. of Mo on content base). Consequently, the total quantity of molybdenum products imported by China in the first 2 months of 2009 came to approximately 8.12 million lbs. of Mo on content base.
On the other hand, in January - February of 2009, China exported <> molybdenum oxide : 1,015 tons on material base, <> molybdenum sulfide : nil, <> ferro-molybdenum : 11 tons on material base and <> total : 1.22 million lbs. of Mo on content base as calculated on IMOA method.
In line with the measures to secure important material resources, the Central Government of China has adopted from the 18th June of 2007 the system to allocate the quantities of molybdenum products to be exported from China and this system has continued to be effective up to this moment as of 2009. The total quantity of molybdenum products allocated for exports in 2009 (the first portion) has come to 34,912 tons on material base (including 30,310 tons in total of ferro-molybdenum and molybdenum oxide), which are compared with 36,872 tons on material base (or 26,300 tons on Mo content base) allocated for exports in 2008. However, as a matter of fact, China exported 24,573 tons on content base of molybdenum products in 2008, having become lower than the allocation for exports in 2008. This decrease of the exports in 2008 reacted to the rushed exports of molybdenum in 2007 and also was influenced by a sharp fall of prices for molybdenum products arisen from October - December quarter of 2008.
However, in the last 2 - 3 years when the international prices of molybdenum products had risen to a substantial extent and maintained a high level (kept on a level of US$30 per lb. of Mo), China turned to increase their molybdenum production. Consequently, the convertors concerned in the western world have viewed that China would have held approximately 19 million lbs. of molybdenum as potential excessive stocks (produced on high cost). When Chinese consumers turn to import molybdenum products from overseas sources, these imports of molybdenum products into China are thought to put a considerable impact on the excessive stocks of molybdenum produced in China.
China was one of major countries to export molybdenum to the world market in the last more than 10 years and had shared nearly 20% of the world demand for molybdenum but, when China turns from the country to export molybdenum to the country to import molybdenum, this change will be not negligible to influence substantially on the world demand for molybdenum. Reflecting cutback of steel production caused by reduced production of automobile, the world demand for molybdenum has declined to a large extent at present and molybdenum has turned to an oversupply but, if steel production changes to recover on a basic tone from the second half of 2009, prices of molybdenum products have a possibility to rebound in an unexpectedly earlier time.
|last modified : Wed 22 Apr, 2009 [10:46]|