Molybdenum

[goforthebet]

Molybdenum seen weak in 2009 but recovery in 2011

US based CPM Group said that molybdenum prices will stay low at between USD 10.50 and USD 11 a pound this year because of weak demand from steel makers, but in 2011 it will rise to above USD 20 as demand rebounds.

Mr Douglas Horn commodity analyst at CPM said that global stimuli packages will help boost prices of molybdenum to around USD 16 in 2010. He added that "There is a large amount of government infrastructure spending coming online. Our estimates indicate that over USD 700 billion will be poured into the market on the infrastructure side."

Mr Horn said that "They fell for a very good reason. There has been a deep drop in steel production. The fourth quarter of 2008 was particularly bad for the stainless steel industry and they are the largest molybdenum consumer." He added that 70% of molybdenum demand comes from steel production and output cuts during this slowdown had exceeded previous recessions.

On the supply side, he said that there was a big bulge of probable development projects in 2012, but they would depend on financing. He added that "But once re stocking resumes, any upturn could be very drastic, very swift and demand for molybdenum could be quite strong."

(Sourced from www.reuters.com)


http://steelguru.com/news/index/2009/03/07/ODUyMzM%3D/Molybdenum_seen_weak_in_2009_but_recovery_in_2011.html