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Molybdenum Concentrate Prices to Remain Lackluster Even After Hitting Record Low
Jul 17,2013 10:51CST
industry news
Source:SMM
Molybdenum concentrate prices in China have been falling since the 2008 global financial crisis.

SHANGHAI, Jul. 17 (SMM) – Molybdenum concentrate prices in China have been falling since the 2008 global financial crisis. Domestic molybdenum concentrate (Mo 45%) was quoted at RMB 1,400/mtu on July 16, the lowest since August 2012. This was down almost 10% from early this year and 80% off the record high hit in 2005.  

Molybdenum concentrate producers in Shaanxi, Henan and Liaoning provinces have been suspending production to support prices since mid-2012, but the result turned out disappointing, SMM’s surveys have found. A transitory rally was reported in molybdenum concentrate prices only between December 2012 and February 2013 when supply decreased and demand from steel producers grew.

Production costs are RMB 1,500/mtu for large molybdenum concentrate (Mo 45%) producers in Shaanxi, and even higher at more than RMB 1,600/mtu for smaller ones. The fact that production costs are higher than prices is again forcing some producers to halt production. 

Domestic steel producers are pushing for lower molybdenum prices against lackluster steel industry, which in turn has dragged down molybdenum concentrate prices.

Although molybdenum concentrate prices are now below costs and supply has decreased, downstream demand remains tepid. As such, sluggishness in molybdenum concentrate prices is expected to extend through this winter.
 

molybdenum concentrate prices in China in July

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