The steel sector has been deeply impacted by the global economic climate; with an approximate 50% decline in production. Moly, as an important alloy, is following suit.
Articles Tagged "futures"
The London Metals Exchange is launching cobalt and molybdenum futures contracts in 2009. The LME has orgainized a conference to discuss the markets and how the LME can be used to mitigate price risk management.
Molybdenum prices took a considerable tumble in the fourth quarter of ’08, falling from USD 30 per pound in September 2008 to USD 9.50 at the end December 2008. Despite unprecedented demand for the metal, molybdenum prices crashed as crisis permeated the financial markets.
As the shock waves spread around the global economy; many analysts are starting to hedge their bets on when a recovery will start. In their Global Metal’s Report released this week, Morgan Stanley gave their take on the near future for the molybdenum market.
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.
The first week of 2009 was a sleepy one for molybdenum with thin trading volume as many customers remained on holidays. Activity in China was by far the slowest, with Chinese molybdenum oxide and ferromolybdenum producers halting spot molybdenum offers to overseas customers.
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.
After moly held its position over months of poor market sentiment, the metal has been hit hard. Just over a few weeks, the market price of molybdenum oxide has fallen by a whopping 30%.
After holding its ground much longer than other base metals, molybdenum’s price point has given way to the global economic current. The metal was stable in the $32 to $35 a pound range for much of this year; holding its value compared to the price plummet of the other base metals.
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.