Molybdenum – Not your average metal
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Moly market remains unique
When investors first turn to metals to diversify their portfolio, they usually stick to the classic metals- silver, gold, and copper. The exotic metals- molybdenum, uranium, and tungsten are rarely part of this first attempt.
At the present moment, uranium, although an “exotic metal”, is a bit of an exception to this. It is a first-stop for investors, as the cat is out of the bag when it comes to the profit potential of uranium stocks and companies.)
The classic metals have all seen substantial price surges during the past several years, but they pale in comparison to the surging prices for the exotic metals. The price of uranium skyrocketed to a high of more than $113 per pound in March, up from about $10 five years ago, while molybdenum jumped to roughly $30 per pound from just $3 over the same time period. At the beginning of this year, moly held steady at $31.00 and $33.00 per lb. Since then, the price has moved upward to $34.00 per lb. Market indicators forecast an upward swing in the prices towards the $40.00 per lb mark, over this year. This is attributed to the tight supply and rising demand for the metal.
Sure, the past year has not offered the very large fluctuations that the metal has seen historically, but an intertesing trend seen is that while gold and silver have fluctuated recently, moly has held firm. Many market experts are giving moly the tagline – “The next uranium”- hinting at the potential profits a savvy investor can make.
The amount of money to be made from investing comes down to how early you can spot a trend and climb onboard. Moly still offers a great opportunity to purchase one of the first tickets for the ride that could generate a windfall by way of profits. There are moly juniors in the games that showcase the opportunity to buy shares at just dollars per stock. Moly’s tight supply and growing demand picture will do the rest of the work at moving market prices.
This week’s newsmakers
International Star Inc (I-Star) has released result details on its Detrial Walsh claim block in the Mohave County, Arizona.
I-star had previously released the news in July that assays on 252 samples support the historical records of significant molybdenum mineralization in the Black Mountains. These samples are a part of I-star’s ongoing exploration work that is aiming to bring historical data up to current NI 43 101 standards. So far, estimates are 120 lbs/tonne of copper, and up to 28 oz/ tonne molybdenum. On a historical claim line, I-star has confirmed AMAX’s 1960 results. By duplicating the historical findings, the data on this line are national instrument compliant. Subject to obtaining additional funding, a new phase of exploration and drilling to verify historical data is the company’s next step.
This week, Golden Phoenix Minerals (OTC:GPXM) issued a President’s letter to shareholders. In his letter, Robert P. Martin, reported on the Q 2 performance of the company’s Ashdown Project Molybdenum Mine. The Ashdown project has been undergoing a ramping up process, evident in the Q 2 sales report. Total second quarter sales were $4,557,079- bringing Ashdown’s first half sales in 2008 to $8,618,303. This compares to Ashdown’s sales for all of 2007 totaling $10,398,361.
Mercator Minerals (TSE:ML) announced this week that it was on track for start of their Mineral Park Molly/copper mill expansion in Arizona. Mineral Park will commence commissioning activities in September with the mill start up projected for October. The expansion will increase the mill’s capacity by 50,000 tonnes per diem. Over the first decade, Mercator expects the mine to produce 10.3 million lbs of molybdenum, in concert with 56.4 million lbs of copper and 0.6 million ounces of silver.
The struggling Shanghai-listed Kingair Machinery Company Limited is planning to boost profits by exiting the air conditioner manufacturing industry, and instead taking a stab at molybdenum mining. They plan on achieving this goal by selling off all off their air conditioner manufacturing assets, worth an estimated $37.8 million, as well as issuing well as 130 million new shares at a $1.27 per share price of for a 100 per cent stake in Inner Mongolia Ejin Banner Shengyuan Mining Company Limited (Shengyuan Mining).
Shengyuan currently holds the rights to 36,800 tonnes of molybdenum reserves, as well as the rights to three ore processing facilities; two of which have a combined production of 1,900 tonnes, the third facility is in development and will be ready in the spring of 2009. In 2009, with all the operations in full swing, Shengyuan is expected to generate sales of $50.9 million.
Tags: bdenum, gold and silver, investing news, juniors, kingair, market experts, market indicators, metals, moly, savvy investor, shanghai, supply, tight supply, uranium stocks
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