In April 2007, when the Sprott molybdenum fund was created, the minor metal was on a fast track. When the fund was created the metal was trading consistently at US $25 per lb; after the ETF was up and running moly cruised to US $ 40 per lb.
Molybdenum, a seemingly invincible metal this year finally took a hit in the fall as economic malaise spread. The alloying metal is down 65% this year, and this decline was seemingly overnight.
The global economic slowdown is affecting both the demand, and price for molybdenum. 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.
Molybdenum has gone from an obscure metal, to a high performer garnering the attention of the LME, and then back to an undervalued alloying metal. Once an overlooked player in the investment arena, interest in moly picked up when worldwide spending on infrastructure took off, sending the metal’s price to new heights.
The market volatility over the past two weeks has finally it moly. The alloying metal has held its own for months, while most of the other metals declined rapidly as news about the downturn in the economy permeated the markets.
Molybdenum exploration has been on a fast track this year, as a shortage in supply and an increase in demand have pushed prices of the alloying metal up and up. Until recently, moly has held stable despite all the challenges on Wall Street.
The London Metal Exchange will add molybdenum to its arsenal in the second half of 2009. The move was announced on Sept 4th, when the LME board voted in favour of adding both molybdenum and cobalt to its futures trading. The move was met with mixed reviews.
Creston Moly Corp. (CMS) is a Tier 1 TSX-V listed company actively developing its 100% owned Creston Molybdenum Deposit in Mexico's mining friendly state of Sonora.
TTM Resources Inc. is a Vancouver, British Columbia; Canada based publicly trading resource Exploration and Development Company, focused on four assets in British Columbia, Canada.
SAMEX Mining Corp. continues with their Phase I exploration activities at their INCA copper/moly/gold project in northern Chile. For more information click here For company’s website, click here
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