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Different Views Toward Chinese Molybdenum Market

Insiders hold different views toward Chinese molybdenum market: stabilization or decline, according to research from ChinaTungsten Online.

Some insiders are more bearish on short-term molybdenum market that the fall in ferro molybdenum transaction prices in return presses molybdenum concentrate price. The following keys are the main reasons:

First, affected by the continuous drop in international molybdenum price, traders lower their expectations for ferro molybdenum price, resulting in actual transaction prices below manufacturers’ offers.

Second, part of manufacturers may cut product profits for more sales because they need capital repatriation at the end of the month.

Third, several steel mills are understood to postpone ferro molybdenum tender on purpose in order to put press on ferro molybdenum enterprises.

Others forecast that the market will maintain stability in the short term. They think that molybdenum concentrate price will remain unchanged, supporting downstream molybdenum products and restricting enterprises to sell at low prices. The reasons are as following:

First, spot molybdenum concentrates are still tight and major molybdenum mines face little pressure from stocks and funds. Therefore, molybdenum raw material market will stabilize.

Second, molybdenum concentrate price has been exceeded RMB 1,600.t since the Spring Festival and the market without low-cost spot goods will support market price.

Third, although international molybdenum price declines, but with the closed import and export channel, the supply and demand in China will not be affected.

On the whole, the later market trend is not only depending on the mentality of insiders, but also market supply and demand. How steel biddings will perform after the drop of international molybdenum price needs to be the focus of the market.

Prices of molybdenum products on May 28, 2018

Picture of ammonium heptamolybdate

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