Molybdenum prices have crashed from a high of $35 per pound at the end of October down to the recent level oft US $12 per pound. This represents the worst decline when it comes to commodity prices; a 53 percent drop to be exact.
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 sudden and violent drop in molybdenum prices from $26 to $12 has left investors in shock. George Topping, an analyst at Blackmont Capital said: Looking at market reports, we’re hearing of trades in single digits. It’s an amazing decline. For full story, click here
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%.
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 past week was arguably the most volatile in market history, however, molybdenum managed to continue its recent trend of holding steadfast despite the market’s hiccups. This was a week that saw stocks and commodities across the board plummet.
The molybdenum market is bracing for price increases in September on increased buying activity from stainless steel mills and mounting concerns over a consistent supply. The availability of ferromolybdenum remains tight as output falls at a number of major producers.
Mr Jonathan George, CEO of Creston, said: Molybdenum is trading at around USD 33.85 per pound but we see it moving up into the USD 40 per pound range in 2009 because there is a stranglehold on molybdenum supply. For full story, click here
Metalbulletin.com reported that Molybdenum prices could rise as high as $50 per lb in the next few years, as per Mike Gloyne of Moly Mines. For full story, click here
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