[SMM Weekly Review] Molybdenum concentrate inventory will be consumed greatly due to frequent shutdown events in molybdenum mining enterprises.

SMM7 March 23: the mainstream transaction prices of 45% molybdenum concentrate this week are 2310-2350 yuan / tonnage, and 60% ferromolybdenum mainstream transaction prices are 15.2-155000 yuan / base ton, which are stable compared with last week.

In the first half of this week, the domestic molybdenum market as a whole showed a multi-empty intertwined situation. On the negative side, the market suppliers have chosen to take profits, and the supply of molybdenum concentrate has increased significantly. At the same time, the power and production restrictions of steel mills in Henan and other places have led to a decline in the overall demand for ferromolybdenum this week. According to market participants, the tender for ferromolybdenum in domestic steel mills was about 2900 tons last week, but it has dropped to more than 2000 tons this week. In many aspects, the environmental protection inspection team is stationed in Liaoning, as the main producing area of ferromolybdenum in China, some ferromolybdenum producers have stopped production and sales, and the supply of ferromolybdenum has been reduced. Under the influence of the interweaving of long and short, the market wait-and-see mood is strong, and the price is mainly stable.

In the second half of the week, there were frequent emergencies at the supply end of the molybdenum concentrate. According to relevant sources, production in the Luming molybdenum mining area in Yichun, Heilongjiang Province, stopped again on July 20. It is understood that the reason for this shutdown is the same as that in mid-June, which is still due to equipment failure. Production is expected to stop for about 10 days. After that, on July 23, the Shanxi molybdenum mining area of Jinduicheng Group was shut down due to heavy rain, and the specific recovery time depends on the weather conditions. The output of molybdenum concentrate was greatly reduced under two emergencies. However, there is no obvious fluctuation in the market price. according to SMM, the main reason is that there are sufficient stocks in the market, and some trade and production enterprises are in the stage of stock drainage and profitability. therefore, the relationship between supply and demand in the market has not changed greatly.

SMM analysis shows that although the decrease in molybdenum concentrate production in the second half of the week does not cause obvious price fluctuations, it will play a significant role in consuming the market inventory in the coming period of time. According to the current situation, the inventory of some enterprises will be exhausted at the end of the month, and if there is no new capacity to supplement, especially Jinduicheng can not resume normal production, the market price may hit a new high.