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Moly Oxide Price Quoted At LME Permeates Into Actual Trade In 2011
= Antofagasta Introduces LME Moly Price Into Contracts To Be Settled In 2011 And Afterwards
While it is marked to see from when does price of molybdenum oxide started to be quoted at LME from the 22nd February of 2010 permeate into actual trade, Antofagasta, a producer of copper and molybdenum in Chile, announced on the end of last week that the Company has planned to introduce the price of molybdenum oxide quoted at LME into contracts on sales of molybdenum from 2011.

Antofagasta produced 17.2 million lbs. of Mo in molybdenum concentrates at the Los Pelambres mine in 2009, which decreased by 3.4% compared with that (17.8 million lbs.) in 2008, but is scheduled to increase the output in 2010 to 20.9 million lbs of Mo in concentrates. Therefore, the output of Mo at Antofagasta in 2010 is expected to return to a nearer level to that (22.49 million lbs.) produced in 2007 as the highest record.

For a reference, according to the settlement of accounts for 2009 released by Antofagasta, their realized price of molybdenum price in 2009 was US$11.30 per lb. of Mo on average, having fallen largely from that (US$23.90) in 2008 for a depression of the molybdenum market. Consequently, the credit for by-products (mainly molybdenum) against copper price has fallen and cash cost on average for copper in 2009 was 96.3 US-Cents per lb., having had a rise from that (87.3 US-Cents) in 2008.

The world output of molybdenum in 2009 was 440 million lbs. on Mo content base and that in 2010 is on a basic tone to increase but not possible to expect an expansion on a large scale. The reason is that, reflecting a crisis of the monetary market caused by the Lehman shock emerged in September of 2008, most of new molybdenum projects have been postponed by 1 - 2 years from those initially planned.

The quantity of molybdenum produced by Antofagasta has shared only 0.4% of the world production but it is certain that Antofagasta is one of main producers of molybdenum. Antofagasta has been operating copper - molybdenum complex mine and 50 - 60% in the world production of molybdenum has been shared by that recovered as by-product.

Many of actual transactions on molybdenum have been so far based on price of molybdenum oxide published periodically in a specialized metal magazine but, in anticipation of a higher transparency in price of molybdenum oxide quoted at LME, Antofagasta intends to introduce LME molybdenum price into contracts as the base to be settled in 2011 and afterwards. Antofagasta expressed to introduce LME molybdenum price into contracts on sales of molybdenum as the first case for major molybdenum mines.
last modified : Thu 18 Mar, 2010 [09:48]
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