Molybdenum’s Long Term Potential
Ken MacDonald Vice President of Business Strategy and CFO Erdene Resource Development discussed the factors controlling the current molybdenum market.
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Molybdenum as a Clean Energy Option
Molybdenum is increasingly being favored by scientists looking to create cheap and efficient hydrogen power.
Molybdenum Rule Changes In China
The latest five year plan from China limits the production of many base metals in including molybdenum. China the world’s largest steel producer may find itself importing more molybdenum as a result.
Molybdenum Demand and the Rebuilding of Japan
Japan will need massive amounts of steel to rebuild what the tsunami washed away. Infrastructure and new automobiles will pave the way for steel demand in the country. While the events in Japan are horrific and depressing, and may affect global markets for quite some time, the need for steel will likely use up a large portion of the surplus that is currently holding down the price of moly.
Molybdenum Mining on the Continental Divide
The Continental Divide region is arguably the world’s most important moly producing deposits. At full production, these deposits could have a serious impact on world molybdenum supply.
Strong Demand and New Markets Benefit Molybdenum
The use of molybdenum in energy projects from nuclear energy to renewable will add new demand pressures on moly over the course of the year. Prices on the LME have been steadily gaining already this year, increased demand will only add to these dynamics.
Molybdenum May Revolutionize Nanotechnology
Scientists have been playing around with moly’s unique attributes to make a whole host of new products that in the future may add a new dimension to demand.
Moly Surpluses and Price Volatility
After low prices enticed China to become a net importer of molybdenum, surpluses built up may cause price stagnation in 2011. Steel demand is slated to grow in 2011, just at a slower rate than seen in the past few years.
Steel Market Growth and Molybdenum Prices
Growth for steel demand in China is expected to dip below 10 percent for the first time in recent years. Growth in the steel market, and consequently growth for moly is expected to improve, however, at a slower pace than in recent years. These factors may influence moly price in 2011.
Trends in Molybdenum Market in 2010
Many molybdenum firms benefited from higher prices for moly in 2010 as well as massive investments from moly hungry China. Backed by growing steel demand from the urbanization of China, moly prices rose from the abysmal $8 lows in 2008 up to $18 per pound in April 2010, prices have since settled to around $16 per pound.
