December 3, 2021 – Chinese molybdenum prices have risen by more than 10% since mid-November 2021. What is behind this? On the SHFE and LME, the majority of base metals are up today. And why entrepreneurial strength can’t be achieved with bans and laws.
Base Metals: A look at SHFE and LME
On the Chinese SHFE, Base Metals are quite balanced this morning. Aluminum (0.4%), Nickel (0.6%), Zinc (0.85%), Copper (0.5%) are slightly up. Lead and tin hardly move.
In Europe, the majority of base metals point to the positive. With two outliers in aluminum (+1%) and Zinc (+1.7%). The LME nickel futures (NICKELc1) are currently at about $ 20,070 per ton.
The German DAX shows more than 1% up at the start of trading and Japan’s Nikkei index has closed at 28029.57 points (+1%). Already yesterday, the US Dow Jones Index had closed with a whopping plus of 1.82%.
Molybdenum prices pull up significantly
Molybdenum prices, which are interesting for stainless steel grade 316, among other things, have risen significantly again since mid-November 2021 – on average by more than 10%. Today alone, prices for Chinese molybdenum went up between 3.61 to 5.82%.
The background is a blockade of transport routes in China’s Inner Mongolia. In addition, Northeast China and Inner Mongolia are struggling with low temperatures and snowfall. In addition, there are low inventories at more molybdenum mines and production interruptions due to license reviews.
This has led to an acute shortage of molybdenum concentrates and is driving up prices.
EC: If you can’t do it with business strength, you have to have laws and bans
The automotive industry has been suffering from a shortage of semiconductor chips for months. The majority of these chips come from Non-European countries, especially Asia. Asia records the world’s highest export of semiconductor products. In 2019, this export accounted for more than 62% of the market.
European carmakers need the Asian semiconductor products, as there is no significant production for chips, transistors, diodes or similar products in Europe.
EU semiconductor industry to come
The European Commission has decided during the pandemic that a semiconductor industry must be built up in Europe, in order to secure the supply. Currently, however, it is becoming clear that this will only be possible if the semiconductor industry is positioned against imports from competing countries by means of market protection and anti-dumping measures.
EC Export Control Forum with difficult agenda
So the EC 2021 Export Control Forum, which is supposed to strive for export control, is used to use the entrepreneurial weakness of European semiconductor manufacturers to call for a “level global playing field “*. Since one obviously cannot compete with Asian companies.
*Note: Level playing field is the European Commission’s favorite term for putting imports in a bad light.
Asian semiconductors soon on EU anti-dumping list?
The European car manufacturers should listen to such demands. The semiconductor crisis has not yet been overcome. And the important EU automotive industry is unlikely to have any interest in Asian semiconductors ending up on the EU’s anti-dumping list. In the end, this could aggravate the automotive crisis again, which would not please anyone in Europe.
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