Somewhere in China there is a warehouse filled to the ceiling with molybdenum, a tongue-twisting metal that most people call moly and that has a number of interesting uses, ranging from oil drilling pipe to steel for armaments. Tim Treadgold writes this in a recent post on Forbes.
Molybdenum price spike since mid-2020s
Since the middle of last year, the price of molybdenum has risen more than 60% from about $7 per pound to $11.50 per pound, down $1 from a peak of $12.50 per pound reached earlier this month.
Molybdenum oversupply since Covid19 pandemic
According to an analysis of the molybdenum market by Australian investment bank Macquarie, there was an oversupply of about 45 million pounds in the global market last year due to a drop in demand caused by the Covid.
Molybdenum deficit expected to reach 16 million pounds
This year, however, the molybdenum market is expected to recover, creating a 16 million pound deficit as demand exceeds supply.
Price artificially inflated by buyouts?
The problem that is troubling the bank is trying to understand the sudden shift in the market. The only explanation is that Chinese buyers were busy soaking up the molybdenum surplus in the second half of last year, driving up the price.
Source: forbes.com
Read also:
- Is TSINGSHAN Group benefiting from the drop in nickel prices?
- China: Inner Mongolia shuts down blast furnaces, converters and coking plants
- European steel mills again charging base prices plus alloy surcharges
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