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| Price Of Moly Oxide Has Risen To US$17 Per Lb. /Mo With Anticipation Of US$30 In 2010 |
| = Leaving Stiffness To Defer New Investments To Be Practiced In 2010 |
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The market price of molybdenum oxide has still continued to rise and the oxide prices offered by dealers on the end of last week were in the range of US$17.90 per lb. of Mo as a higher side and US$16.90 as a lower side, having risen by 2.3 times compared with that (US$7.70) as bottomed in April of this year. Some of the parties concerned have anticipated that price of molybdenum oxide will return to the level of US$30 per lb. of Mo in 2010 and the cases, which major molybdenum mines have decided in autumn of last year to defer their new molybdenum projects, are supposed to put a substantial impact on the world situation of molybdenum supply. The initiative to have risen steeply molybdenum prices is the heated imports of molybdenums by China and this aspect has still continued. In June of 2009, China imported <> roasted molybdenum ore : 5,146 tons (compared to 3,906 tons in May), <> unroasted molybdenum ore : 1,477 tons (636 tons in May), <> ferro-molybdenum : 29 tons (49 tons in May) and <> total : 6,652 tons (4,591 tons in May), having increased by 45% from that in May. Also, the total quantity of molybdenums imported into China in January - June of 2009 came to 33,218 tons, which had a remarkable increase of 10 times compared to that (3,110 tons) in the same period of 2008. For a reference, China exported 701 tons in material of molybdenums in June of 2009, which increased by 54% compared with that in the previous month of May but had a considerable decrease of 71% compared to that in the same month of 2008. There is a view in the market that the heated imports of molybdenums by China will not stop, even if molybdenum prices have risen to the higher levels as seen at present. It was forecasted that, when price of molybdenum oxide could have risen to a higher level than US$12 per lb. of Mo, medium and small molybdenum mines in China, having suspended to operate, would resume their molybdenum production and molybdenum output as a whole should increase, causing a power to restrain a further rise of molybdenum prices. However, the current situation seems to have been involved in the speculative imports of molybdenums by China. The output of molybdenum in concentrate recovered by copper mining companies as by-product had shared 80% of the whole production but has fallen from 1 - 2 years ago and this case caused to maintain price of molybdenum oxide on the level of US$30 per lb. of Mo during 2007 to 2008 (by the end of September). Under the present situation, even if molybdenum prices turn to rise steeply, it will be difficult for copper mining companies to increase immediately their molybdenum production. Therefore, the parties concerned have an opinion that the supply situation of molybdenum in the second half of 2009 is thought to be short. Originally, in anticipation of that the consumption of molybdenum in the western world for 2009 will decrease by 30% from that consumed for 2008, many of molybdenum mines made up on the beginning of 2009 their plan on molybdenum production in this year and, therefore, it will take a certain time to loosen the structure for cutback of molybdenum production. From this point of view, the world situation of molybdenum supply in 2010 is forecasted to face a severeness, because new sources to produce molybdenum have been limited. Most of new molybdenum projects scheduled to start molybdenum production in 2010 have been decided to defer and this aspect will become a big source of calamity. The current movements of molybdenum projects are as follows ; (1)Freeport-McMoRan of the USA initially planned to resume molybdenum production at the Climax opencast mine (primary molybdenum mine in Colorado State to produce 20 million lbs. / year of Mo) but this resumption has been postponed to 2011., (2) General Moly of the USA initially aimed to commence new molybdenum production at the Mount Hope mine (copper - molybdenum complex mine in Nevada State to produce 40 million lbs. / year of Mo) but this target has deferred to 2012., (3) Adnac Molybdenum of Canada has held new project to produce molybdenum at the Ruby Creek mine (located in British Columbia Province to produce 13 million lbs. / year of Mo) but this project has been amended to commence from 2010 and afterwards., and (4) Moly Mines of Australia has planned to produce 10 million lbs. / year of Mo at the Spinifex Ridge mine in Western Australia as the first phase but this project has been postponed to develop from 2011 and afterwards. These postponements of new molybdenum projects have been influenced by the difficulties to finance necessary funds caused by a crisis of the world economy emerged from September of 2008 and the anticipated shrink of molybdenum demand caused by a reduction in production of crude steel. |
| last modified : Mon 17 Aug, 2009 [13:10] |
