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Standing moly producers left hoping that output cuts will increase prices.

By Leia Michele Toovey- Exclusive to Moly Investing News

The global economic slowdown is affecting both the demand, and price for molybdenum and molybdenum disulfide.

China ^[2] just announced that its exports of molybdenum are down 6.1 per cent in October, and 21.6 per cent annually for the year on year period. China shipped out 2245 tonnes of molybdenum products in October, and 2230 tonnes in September.  The total export of molybdenum products in the first ten months reached 21,734 tonnes plummeting from 27,724 tonnes molybdenum in the review period of last year. To cope, companies are planning output cuts and plotting new investment strategies.  For the few companies that have a very strong financial position, they are on the look out for acquisitions. At the same time struggling companies may be left with not option but to merge.

BHP Billiton ^[3] will delay the development of a plant to process molybdenum at a Chilean mine. Mauro Valdes, BHP's spokesman in Santiago said that the decision was made after the price of molybdenum dropped. BHP hadn't yet approved the investment in the plant at its Escondida copper mine in Chile; he facility would cost between US $120 million to $150 million to build. BHP owns 57.5 per cent of Escondida, while Rio Tinto Group owns 30 per cent, a group led by Mitsubishi Corporation owns 10 per cent, while International Finance Corporation owns the remainder.

Freeport McMoRan Copper & Gold Inc ^[4], the world's largest publicly traded copper and molybdenum producer  will postpone the reopening of a molybdenum mine in the US and cut production at another facility. Plunging metals prices coupled with the global equity freeze have hammered the company's share value. Now, they need to cut their spending budget by $800 million. If economic conditions deteriorate further, Freeport may close its Chino mine in New Mexico.

Hunt Gold Corporation has sold its molybdenum investments.  Held through subsidiary company American Molygold Corp, the molybdenum interests were unloaded for US $620 million to be settled in shares of Common Stock of the purchaser.  The purchaser, who has yet to be named is an American quoted company focused exclusively on the business of Molybdenum. The sale will be completed upon the transfer of title of the various claims held by American Molygold Corp, to the Purchaser.  This transaction will be completed by mid January 2009 with all proceeds from the sale to be distributed among stockholders. This will result in a Stock Dividend payout to stockholders valued at US$0.0021 per one share of Hunt Gold Corporation Common Stock.

Roca Mines ^[5] will scale back expansion plans for its MAX Molybdenum Mine following a dramatic drop in the market price of molybdenum. President and CEO of Roca Mines Scott Broughton announced that his company will continue producing molybdenum through the existing Phase 1 of the project; however Phase 2 will be on hiatus. Phase 2 includes plans for expansion of the mine and also exploration in the area for new deposits.  The Phase 2 of the project will be delayed anywhere from a month to more than a year, depending on market conditions. Roca Mines announced that the MAX mine is profitable at current prices due to the fact that the design of the mine allows for low cost production. Roca Mines is optimistic about the future of molybdenum prices, claiming fear and turmoil on the markets is causing moly to be undersold despite strong fundamentals. On the upside, the supply of molybdenum has taken a hit because many high-cost producers have already pulled the plug on their operations and have shut down.  Mr. Broughton added that molybdenum prices have a tendency to spike up and down very rapidly, so they don't want to miss out on the up side of prices when they come back up. For that reason Phase 1 operations will continue, and Roca Mines will not lay off any employees who are actively involved in Phase 1.