Domestic Molybdenum Market was Wait-and-See 【SMM post-holiday review】

SHANGHAI, Oct 8 (SMM) - Domestic steel bidding suspended during the National Day holiday, and the overall market demand remained low. At the same time, affected by the continuous decline of global molybdenum prices before the holiday, the transactions of small orders were also weak, and traders were inclined to sell off their goods. Currently, the domestic ferromolybdenum prices stood between 150,000-154,000 yuan/mt, down 1,500 yuan/mt from before the holiday.

The domestic molybdenum market needs to pay attention to the following points after the National Day holiday:

1. The impact of domestic power rationing remains as the market focus. Due to the implementation of the “dual control” policy of energy consumption in many places in China, the steel mills have reduced their production, shrinking the demand for ferromolybdenum sharply, which is the main reason for the recent decline in domestic molybdenum prices. Therefore, the "dual control" policy after the National Day holiday is a key factor affecting the trend of the molybdenum market in the near term.

2. Due to the continuous increase in the prices of auxiliary materials of ferromolybdenum and the falling prices of ferromolybdenum, the profit margin of ferro-molybdenum before the holiday was greatly squeezed, which in turn caused some small and medium-sized enterprises to shut down their production lines. The rise in the prices of auxiliary materials has supported the prices of ferromolybdenum. Therefore, the price trend of  auxiliary materials after the holiday will affect the price space of ferromolybdenum to a certain extent.

3. International molybdenum price trend. Although the international molybdenum prices have fallen all the way before the holiday, there are still certain advantages compared to the domestic prices as a whole, which has encouraged many domestic companies to consider exports, easing domestic supply pressures to a certain extent. The trend of international molybdenum prices after the holiday will have a certain impact on domestic prices.