SHANGHAI, Apr 29 (SMM) - Last week, domestic molybdenum prices first rose rapidly driven by shipments from molybdenum mines; then, because downstream companies and steel mills were unable to transfer the pressure of sharply rising costs to downstream buyers in a timely manner, they were unwilling to accept this price level. Therefore, the molybdenum price began to quickly pull back and trading volume shrank.
Molybdenum concentrate market: During the week, the lowest average daily price of molybdenum concentrate was 3,365 yuan/ton, and the highest average daily price was 3,765 yuan/ton, with a cumulative increase of 400 yuan/ton, and a weekly increase of about 12%. Molybdenum mining companies were unwilling to ship goods; traders have suspended their inventory replenishment plans, and the circulation of molybdenum raw materials in the market has tightened.
Ferromolybdenum market: At present, the profit margin of downstream molybdenum-containing steel has indeed rebounded, and there is also a good expectation for an increase in demand; but the price of ferromolybdenum has risen too quickly following the price of molybdenum raw materials, and the spot price of steel mills can hardly increase rapidly. According to the current cost price calculation, the profit of molybdenum-containing steel is directly reduced to the lowest point by the rising cost of ferromolybdenum.
Some steel mills stated that the current ferromolybdenum price does not allow them to purchase according to their production plans; a small number of steel mills that purchased also often experienced bid failures. The transaction is weak. Some ferromolybdenum sellers have tried to sell off goods to make a profit, but the results have been poor.
Analysis As of the weekend, the bid solicitation volume of ferromolybdenum this month exceeded 12,000 tons, and the demand was strong. SMM predicts that as molybdenum prices return to rationality, molybdenum market transactions will become active again; in the short term, there is still room for a small drop in molybdenum prices.
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