[www.ferro-alloys.com]Molybdenum trading has come to a near standstill with buyers and sellers recently unable to agree on a price to complete any transactions, even though the dealer spread has narrowed. Molybdenum prices soared earlier this year, rallying about 70% to their peak, but have since stabilized. The stabilization and even a correction is expected, following such an aggressive rally. Expectations are that molybdenum prices could fall down to $7.00 per lb. Still, the recovery in 2016 was welcome. In 2015 molybdenum was the world’s worst performing metal due to oversupply and weak demand.

Meanwhile, major expansions are underway in the molybdenum industry. China Molybdenum has planned to acquire overseas assets totaling more than $4 billion, but not all the acquisitions are for molybdenum assets, they include other niche metals, but the acquisitions, if profitable, could help the company’s molybdenum investments.

When it comes to the molybdenum market, historically, China has been accused of not playing nice. Deemed a strategic metal, China produces most of the world’s molybdenum. The country has limited exports in the past, but just when molybdenum suppliers outside China were able to ramp up production the country in turn flooded the market with molybdenum, crashing prices and making the mining of the metal unprofitable for these other miners. After China, the US is the world’s next biggest molybdenum producer, therefore, American molybdenum miners have suffered the most when China took advantage of its molybdenum market monopoly.

Even now, China has a degree of influence over the US’s molybdenum industry. One of the major up and coming molybdenum projects in the US, CuMoCo’s CuMo project – a molybdenum-copper-silver deposit in Idaho. Shan Resource Holdings Ltd. (PS Resources), a subsidiary of a leading Hong Kong based commodities group, and MCC8 Group Company Limited (MCC8, and collectively with PS Resources, the Chinese Partners), a China-based leader in Engineering, Procurement and Construction (EPC) are helping develop the project.