If you believe that the estimated recently by Terry Adams of UK-based Adams Metals and the Albemarle Corporation, then the growing demand for molybdenum products could be the business impact POSCO Stainless Steel. The Korean-based steel plant, with about 6.5 percent of sales of stainless steel, the world of the fourth or fifth, depending upon production or market capitalization.
After 2006, the company's annual report, POSCO has exported more than 70 percentsteel products in Asia, especially China, Japan and Southeast Asia. In response to record high nickel prices, the steelmaker announced it would begin manufacturing nickel-free stainless steels. So did European steelmakers ThyssenKrupp and Outokumpu, which will be based in particular on its austenitic products.
It would be a sustained rally in the moly price result have suffered the same reaction of nickel recently? Unfortunately for steelmakers, molybdenum has a broader range of applicationsnickel.
At a recent industry conference, Terry Adams, shocked his audience with notice of potential supply / demand imbalances begin as early as 2011th He believes that by 2015 could be the price of molybdenum, "interesting."
But it was the first sign of trouble for beer buyers molybdenum. In early May, said a retailer American Metal Market magazine: "We simply do not have coverage available." He lamented that primary producers Moly, also known as a manufacturer of swing,"have to sell something now."
On June 18 it expects China to allocate export quotas for molybdenum products has a limited number of exporters to announce. Potential labor disputes in the copper mines in Mexico and Chile could further reduce available molybdenum supply later in the month of June. A spokesman for the Chilean workers warned of a strike "hard and long." Molybdenum extracted as a byproduct of copper production accounts for about 60 percent of the world's.
ThisTime could be as high amounts of molybdenum already influenced this summer. Until next year, if the primary production of molybdenum is not growing rapidly to meet demand, prices could worsen the climate for end users. Some operators believe that the price of molybdenum could soon creep above previous lists summit two years ago. "There's a lot to get fixed, because there is a lack of material," said a dealer at the beginning of the week. "It's not much on the floor."
After severaldown-the-road demand forecasting is the magic number of 460 million pounds of molybdenum. Adams predicts that projected western world demand could reach this consumption by 2015. Others believe strong demand for molybdenum could bring this target consumption a few years earlier.
Another problem is that we are clearly in a previous article.
stockinterview.com/News/11082006/Roasting-molybdenum.html USGS molybdenum commodity specialist Michael Magyar warned of a bottleneck, "... we can not roastmuch more moly right now. No one is actively committed to allowing greater capacity for roasting in North America.
More roasting capacity is coming online this year or next year, courtesy of Molymet. Adams points out: "With the growth in demand is a new roaster, the size of the roaster Molymet new every two years, is necessary." Adams continued: "Without further investment in a roaster bottleneck could occur in 2011. Molymet roaster plans another this time, but onlymay also two years of growth. "
In his lecture, Adams has seen in the future. While the western world demand should continue to increase annually by three percent, we could demand in China and the CIS more than 10 percent per year. "The combined effect would be an overall annual growth rate of around 4.5 percent, he predicted." Western mines have increased production of at least 6 percent per year. "
As we and others have concluded, forecast Adams"Better performance on the primary (Mo) mines are needed to fill the gap after 2009."
Come away from delegates attending junior molybdenum mining mentally started to uncork champagne bottles after Adams announced this point. But it was his next two points, which investors should digest:
• New mines primaries or blinds are open until 2011
• By 2013, current primary mines and Climax could have capacity
High level of growth in the chemistry of molybdenumMarket
Molybdenum research to more than a year to understand recently, a number of technical experts (http://stockinterview.com/News/06042007/molybdenum-copper-nickel-condenser-crossover.html) to help us, as molybdenum used condenser tubes in nuclear and desalination plants. Because of the multitude are applications for this metal, while such information is less reliable on the molybdenum sector than in others, we have studied, such as uranium.
Remainto collect data for the forthcoming publication, "Investing in the Great Molybdenum Bull Market" and will present our detailed research at the end of August.
We found two areas of strong growth for the applications of molybdenum.
Not only the market which uses molybdenum. Although steel and low alloy markets represent about two-thirds of the use of molybdenum, which appears to be the fastest growing market catalysts in the chemical market molybdenum.
According to a spokespersonAlbemarle Corporation, the consumption of molybdenum in the catalyst section could grow by more than 30 percent by 2011. The chemical industry could consume more than 30 million pounds during the 2006-2011 period.
The world market is expected catalyst at 13 billion dollars in sales this year. From this, the oil sector should consume about 35 million pounds of molybdenum. Molybdenum is used as a hydroprocessing (HPC) used catalyst.
Increasing global demand for crude oil, the changeFuel specifications and the strength of demand for aviation fuel and diesel should contribute to the demand for molybdenum.
Since the overall quality of crude oil has deteriorated significantly over the past 25 years more of molybdenum as a catalyst could be consumed in the refinery. Sulfur content in oil imports of the United States during the same period doubled. Molybdenum catalysts are used for sulfur from petroleum, petrochemical and coal to remove liquids from
HarsherInformation in the last 15 years have a greater perception of catalyst and more contained molybdenum in these catalysts needed. During this period, the application of catalyst per barrel of crude oil doubled - an average growth rate of five percent per year.
One industry expert expects global HPC catalyst growth to eight percent a year 2006-2010 increased. Consumption of molybdenum for this use could increase by 46 percent by 2010. Annual consumption could generate more than 60Million pounds of molybdenum.
Lack of New Primary Mining Supply
The typical molybdenum concentrates by producers of copper is sold as a byproduct of mining, contain 40 to 45 percent Mo. Concentrates from primary producers often average 50 to 55 per cent.
As a result, primary molybdenum mines provide a desirable approach. Technical moly, also known (MO03 molybdenum trioxide) specifies 57 percent Mo and contains less than 0.05 per cent copper and 0.1 percentSulfur. Primary molybdenum producers provide concentrates with lesser amounts of harmful elements.
Since the concentrate is 'clean' less roasting is required to update the material spec oxide technology. Less electricity is consumed, the multi-hearth furnaces during the roasting power. The primary molybdenum cleaner concentrate offers the roaster more flexibility. The specifications are more concentrated mixed with lower specifications, focuses on the whole product, or to updateRoaster can refine the material more specific separately, if required by the end user.
The less roasting to bring material up to spec could also help avoid the bottlenecks of a few years.
Although the producers of molybdenum by-product provides that the weight of the growing demand must be worn, the copper producer, has not cooperated. Codelco, the production of molybdenum has fallen by 25 percent in 2006 to 60 million pounds last year. Moly production could drop another 15 percent or more of theseYear.
Due to the recent revival price of molybdenum, dozens of exploration companies have 'now' society for molybdenum. There is almost a couple of potentially viable projects.
The primary molybdenum producers and future producers there were controls seem to go ahead with their projects.
Thompson Creek is Thompson Creek. This occurred for the primary player "primary" in North America, while the world waits for Climax to come back online. A bit 'ofbelieve that the Davidson molybdenum deposit of the company in British Columbia may enter on the roadmap of the company. If so, then this could further pressure the price of molybdenum.
Roca Mines should be a producer in the month of July. But the company also hopes to expand its operation and the deep should also start exploration work this summer. In the meantime, found the high-MAX Molybdenum Mine at the company should become a cash cow in the third and fourth quarter of this year. Andprovide for several years. Although the company is not yet in production, there seems no shortage of players molybdenum loudly for future production of the company. Another indication of a limited market.
Last month, Adanac Molybdenum Corp. plants ordered long lead times for construction of mining and processing complex at Ruby Creek. The costs amount to almost 40 million euros, for which the company has its payments. Also, some time this summer, Adanac shouldFinally, permits and construction starts. While the company boasts of 220 million pounds of molybdenum, a proposal recently chat with Adanac consultant Ken Reser was Ruby Creek pounds more than previously thought. Results of drilling in progress could later confirm this hypothesis.
We will continue to watch United Bolero as a promising development company in Montana. We were told drilling at Bald Butte began over the weekend to upgrade the resource category. I hope that the drillingProgram also move to Cannivan Gulch located in their vicinity. Historically, but not technically documented, major miners who worked these properties in the last round Moly, estimates the company features more than 400 million pounds of molybdenum, were hosts.
Primary producers, such as these and possibly others, molybdenum end-users are different, depending on their needs, as we have 2009, 2010 and beyond approach.
After this summer, there will be further studiesOther manufacturers, such as the potential short-term Moly Mines and others.
Conclusion
Many in the area have warned about the possible rise of "moly dumping 'by the Chinese. Historically, China has helped chill out molybdenum prices in the past. According to Adams, as mentioned earlier in this article may, China is no longer a role.
In principle, this should be cause for concern. As a rule, is a country indirectly focused on the background of their leaders. InChina is the case, the eight members of the Standing Committee of the Politburo - China's most powerful politicians - are all engineers. All are graduates of engineering or technology in schools.
The Chinese president, was trained as a hydraulic engineer. The premier is a geologist who also has a degree as a mining engineer. Former deputy prime minister was trained as an electrical engineer, as the leader of the 'propaganda'. The secretary of policy and legislative issues;was trained as a metallurgist. Other graduates in the technology of heat, radio electronics or design of the engine electronics.
engineers like to build things. China has begun the most important period in the history of industrialization, the shadow of the construction of infrastructure of the late 19th century in Europe and North America. Since molybdenum include application architecture, energy, petroleum refinement, coal conversion, chemicals and other industrial applications, there wouldsurprised if China will soon be the "strategic" importance of molybdenum (like uranium) and stops all exports.
Molybdenum plays an important role in numerous and various military applications. World military spending reached $ 1.2 trillion a year earlier. In 2006, China surpassed Japan as the largest military spending in Asia. The Pentagon estimates China could be spending up to U.S. $ 125 billion this year. Be at least ten varieties of ballistic missiles deployed or inDevelopment. Our preliminary research in this field confirms the high percentage of molybdenum in the amount of rockets used. In some applications, the molybdenum content exceeding 20 percent.
In summary, is to determine every time you make a splash in a new area to examine the request for molybdenum, we find growth. Strong demand could surprise many stock and industry analysts in the next decade. Meanwhile, the producers of molybdenum most basic needs to come forward. Unlike some of usI do not think that the history of molybdenum has not yet been fully revealed. This summer, we hope, the molybdenum market more transparent - both on the demand side and supply.
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