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Answers - Molybdenum Outlook 2007-Part One
This past Tuesday, molybdenum traded at $24/pound when a Chilean copper commission spokesperson forecast the metal would drop to an average $20/pound this year. But on Thursday, Platts Metal Daily reported molybdenum oxide trading higher: $24.80 to $26/pound.
We’ve wondered about the price rallies of various metals we’ve been following, hoping to understand some of the emotions behind the excitement. Being skeptical, some of this begins to sound like mob hysteria. On the sunny side of the fence, one could call this exuberance. Cui bono is our question. Who benefits?
For the utilities hoping to obtain nuclear fuel for their reactors, a ri
We’ve wondered about the price rallies of various metals we’ve been following, hoping to understand some of the emotions behind the excitement. Being skeptical, some of this begins to sound like mob hysteria. On the sunny side of the fence, one could call this exuberance. Cui bono is our question. Who benefits?
For the utilities hoping to obtain nuclear fuel for their reactors, a ri
According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product
sing uranium price and lessened available SWU capacity to meet their needs exacerbate the worry about whether not the nuclear renaissance can be realistically sustained. For molybdenum, soaring stainless steel and super alloy demand helps keep the silvery metal well above the actual production costs to mine it. Plans for building more pipelines with stronger anti-corrosive properties adds a sexy energy twist, spicing up what Raymond James mining analyst Bart Jaworski calls a boring story.
With uranium, there is excitement because a very small number of new near-term producers recently signed contracts to sell future U3O8 production with e
With uranium, there is excitement because a very small number of new near-term producers recently signed contracts to sell future U3O8 production with e
; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.
Examples of combination products may in
Examples of combination products may in
scalating floor price protection, or simply sold production at/near the record uranium price. Obviously, they benefit, and so have their shareholders. For uranium companies hoping to produce within the next five to six years, higher prices are likely to attract deep-pocket joint venture partners to bring their mines into production, or to further their development activities. Or simply to raise more cash for their treasury by selling shares at a price they might never have imagined possible two years ago. To the physical uranium speculator, it has provided a double-, triple-, or higher-digit ‘paper return’ on an investment.
The point of r
The point of r
lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.
ising metals prices was to encourage new production in the respective sector. In the case of molybdenum, the metal’s price is pretty much dictated by a relatively small number of western hemisphere copper producers, such as Phelps Dodge (PD), BHP Billiton (BHP), Teck Cominco (TCK) and Chilean-state-owned Codelco. And of course, the eastern hemisphere wild card: China. Molybdenum can be a copper mine’s byproduct, which is basically produced for little or no cost. Aside from a very small number of new near-term primary molybdenum producers, where is the excitement in this sector?
It’s not in the price. In a previous interview with Michael M
It’s not in the price. In a previous interview with Michael M
here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
agyar, USGS molybdenum specialist, he told us, “The price is now trending anywhere. It’s just drifting around $25/pound.” Another industry expert agreed the price is likely to stagnate at this new level for a while.
Despite the ranting of some, molybdenum oxide is unlikely to soon return to the May to July 2005 highs circa $40/pound. The price anomaly was just that – an industry caught off guard too quickly and producing too little. And which within a six-month period caught up with itself. Similar to those projects we have been investigating in the uranium sector, those hoping and praying for another supersonic price rise in molybdenum a
Despite the ranting of some, molybdenum oxide is unlikely to soon return to the May to July 2005 highs circa $40/pound. The price anomaly was just that – an industry caught off guard too quickly and producing too little. And which within a six-month period caught up with itself. Similar to those projects we have been investigating in the uranium sector, those hoping and praying for another supersonic price rise in molybdenum a
d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.
Combination pro
Combination pro
re those backing the more marginal mining projects. After all, if you don’t have economic grades, a parabolic price rise is just the right shade of lipstick for the pig some companies hope to pawn off on the unwary.
Last month, Seeking Alpha published an article we submitted, “In the Case of Uranium Stocks, Smaller May Be Better.” The problem impacting the larger uranium companies, such as Cameco Corp (CCJ) and ERA (Australia) are the legacy contracts whereupon utilities continue to get uranium for less than $30/pound, and in some cases for less than $20/pound. After ERA recently announced record fourth quarter U3O8 production, the Austra
Last month, Seeking Alpha published an article we submitted, “In the Case of Uranium Stocks, Smaller May Be Better.” The problem impacting the larger uranium companies, such as Cameco Corp (CCJ) and ERA (Australia) are the legacy contracts whereupon utilities continue to get uranium for less than $30/pound, and in some cases for less than $20/pound. After ERA recently announced record fourth quarter U3O8 production, the Austra
ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc
lian media highlighted the Down Under miner had mostly missed out on the record price of uranium because of those long-term contracts.
With molybdenum, the smaller projects may be better with regards to the opportunities investors must choose from. In early November in a two-part series, we interviewed William G. Cook, the North American representative for Derek Raphael & Company – currently the world’s largest molybdenum trader. He advised us, “I do not believe we will see any of the moly mega deposits developed in the foreseeable future.”
Cook warned of the considerable capital costs, reclamation liabilities and operating costs for the
With molybdenum, the smaller projects may be better with regards to the opportunities investors must choose from. In early November in a two-part series, we interviewed William G. Cook, the North American representative for Derek Raphael & Company – currently the world’s largest molybdenum trader. He advised us, “I do not believe we will see any of the moly mega deposits developed in the foreseeable future.”
Cook warned of the considerable capital costs, reclamation liabilities and operating costs for the
easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi
behemoth projects. Instead, he pointed to the smaller, higher grade primary molybdenum deposits. It’s where he sees the future of moly production as a complement to byproduct and Chinese production. His emphasis was on “higher” grade deposits. As with other industry experts we interviewed, it is those lower grade deposits which raise the experts’ eyebrows.
Where Does the Price Hysteria Come From?
Molybdenum strongly depends upon stainless steel production. According to the recently published U.S. Geological Survey, Mineral Commodities Summaries, producers of iron, steel and superalloys consumed 74 percent of the molybdenum mined in 2006
Where Does the Price Hysteria Come From?
Molybdenum strongly depends upon stainless steel production. According to the recently published U.S. Geological Survey, Mineral Commodities Summaries, producers of iron, steel and superalloys consumed 74 percent of the molybdenum mined in 2006
nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
. Movements in stainless steel demand can impact the moly price.
Before the holidays, the highly respected MEPS consulting firm forecast higher movement in stainless steel prices. Increasing nickel prices on the London Metal Exchange (LME) during December were cited for the likely higher transaction values for stainless steel into the second quarter of this year.
As of this week, the nickel division of the world’s fourth largest copper miner, Swiss-based mining giant Xstrata (XSRAF), faces a mining strike in Sudbury, Ontario if the company doesn’t come to terms with a union of 1,000 workers, which voted on Tuesday to strike by the end of
Before the holidays, the highly respected MEPS consulting firm forecast higher movement in stainless steel prices. Increasing nickel prices on the London Metal Exchange (LME) during December were cited for the likely higher transaction values for stainless steel into the second quarter of this year.
As of this week, the nickel division of the world’s fourth largest copper miner, Swiss-based mining giant Xstrata (XSRAF), faces a mining strike in Sudbury, Ontario if the company doesn’t come to terms with a union of 1,000 workers, which voted on Tuesday to strike by the end of
and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ
the month. In a similar type of strike nearly two years ago, copper production dropped by 9.6 percent in a quarter at a Falconbridge processing plant (Xstrata acquired Falconbridge since then).
On Thursday, nickel touched a record $36,050/tonne because of those strike concerns. About two-thirds of the world’s nickel mining is used to make stainless steel. Some analysts forecast stainless steel production to grow by 7.5 percent this year. Concern in the trading markets is the 87 percent drop in available nickel stocks in LME warehouses from a year ago. A bit more than one day’s global consumption is now warehoused by the LME. Clearly, a s
On Thursday, nickel touched a record $36,050/tonne because of those strike concerns. About two-thirds of the world’s nickel mining is used to make stainless steel. Some analysts forecast stainless steel production to grow by 7.5 percent this year. Concern in the trading markets is the 87 percent drop in available nickel stocks in LME warehouses from a year ago. A bit more than one day’s global consumption is now warehoused by the LME. Clearly, a s
ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
hort squeeze is roiling the nickel market. And that impact could spread as a price panic perception moves into other alloys required by the stainless steel production markets.
But where does one find the substance with regards to molybdenum pricing? The market has tightened up in January because of China’s new export licensing system. That may just be a temporary blip in the trader’s food chain.
In a July 2005 article written for Colorado Central Magazine, author and former molybdenum miner Steve Voynick wrote, “… there is always concern about the economic validity of price spikes, those sudden, short-term jumps that stand apart from lon
But where does one find the substance with regards to molybdenum pricing? The market has tightened up in January because of China’s new export licensing system. That may just be a temporary blip in the trader’s food chain.
In a July 2005 article written for Colorado Central Magazine, author and former molybdenum miner Steve Voynick wrote, “… there is always concern about the economic validity of price spikes, those sudden, short-term jumps that stand apart from lon
ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.
Following aspects would a
Following aspects would a
g-term price rises.” In his article, Voynick argued for the re-opening of the primary moly mine Climax, but he warned about price stability for this metal, “Historically, moly-market price spikes have shown little stability. Unlike long-term price trends, they are not based so much on true supply and demand as they are on fears of a moly shortage that spur speculative buying.”
During the last moly price boom, primary molybdenum mines produced 75 percent of the world’s supply. Because of the rise of copper prices, the majority of moly production comes as a byproduct of the world’s leading copper mines. Primary producers are now the swing p
During the last moly price boom, primary molybdenum mines produced 75 percent of the world’s supply. Because of the rise of copper prices, the majority of moly production comes as a byproduct of the world’s leading copper mines. Primary producers are now the swing p
dd to the challenges in developing combination products:
Which markets to tap where the combination products can do fairly well?
Which combination prod
Which markets to tap where the combination products can do fairly well?
Which combination prod
roducers, filling the supply gaps when there is increased demand for molybdenum.
We would imagine companies planning to bring molybdenum mines online by the end of this decade carefully study the price trend of copper as well as molybdenum. Australia’s Olympic Dam faces a similar dilemma with their massive uranium forecasts. Should the price of copper not sustain above a certain level, the low-grade uranium might not be economically mined. In this case, BHP could likely spend $5 billion in construction costs to expand the company’s uranium production.
Part of the fidgeting we’ve heard from the emerging moly companies about the metal’s pr
We would imagine companies planning to bring molybdenum mines online by the end of this decade carefully study the price trend of copper as well as molybdenum. Australia’s Olympic Dam faces a similar dilemma with their massive uranium forecasts. Should the price of copper not sustain above a certain level, the low-grade uranium might not be economically mined. In this case, BHP could likely spend $5 billion in construction costs to expand the company’s uranium production.
Part of the fidgeting we’ve heard from the emerging moly companies about the metal’s pr
cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
ice is not about how much higher molybdenum’s price will rise. Their twitches are accompanied by the anxiety over how economic their projects will remain should moly dive as it has in the past. Previous moly price rallies were sharp spikes followed by mercurial descents. Breathtaking on an historical chart, but not the slap-on-the-knee kind of laugh if one was mining during that era. Jobs were lost, mines closed and assets gobbled up by those less dependent upon the moly price.
Why should molybdenum’s price sustain this time, and why should this chart later look different from the one of the past three decades? Yes, yes, yes, of course we
Why should molybdenum’s price sustain this time, and why should this chart later look different from the one of the past three decades? Yes, yes, yes, of course we
tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
are in a commodity super cycle. But even during a secular bull market there are catastrophic plunges washing out the weaker management teams, the less-well-financed and those with more dubious projects.
Should Molybdenum Sustain at Current Levels?
Current developments in the molybdenum and energy markets may offer strong hope for many of the primary producers proposing or planning projects through 2010. Part of the breakdown during the molybdenum production cycle could come from roasting capacity. We covered those concerns in a previous article. Each year, about $37 billion worth of natural gas goes up in smoke or pumped underground to
Should Molybdenum Sustain at Current Levels?
Current developments in the molybdenum and energy markets may offer strong hope for many of the primary producers proposing or planning projects through 2010. Part of the breakdown during the molybdenum production cycle could come from roasting capacity. We covered those concerns in a previous article. Each year, about $37 billion worth of natural gas goes up in smoke or pumped underground to
t?
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
drive more crude to the surface, mostly because of the lack of gas pipelines. According to Hart Energy Publishing’s Pipeline and Gas Technology information center, “Operators are construcing, planning or studying the feasibility of building some 72,924 miles of crude oil, natural gas and refined products pipelines throughout the world to meet growing energy demand.” Almost 77 percent of worldwide pipeline construction is to transport natural gas – more than 55,000 miles planned or underway. Under construction or being planned are nearly 14,000 miles of crude oil pipelines.
Intrinsic to the future and more lasting success of these pipeline
Intrinsic to the future and more lasting success of these pipeline
ping new procedures for reviewing their safety, efficacy and quality.
Professional from academic institutions, pharmaceutical industries, health care indust
Professional from academic institutions, pharmaceutical industries, health care indust
projects is the emerging trend toward the replacement of Stainless Steel Type 316 with a higher moly content stainless steel product called 6Mo Grade, or 6-percent Molybdenum Stainless Steels. Because of the increased construction of offshore and sour gas pipelines, great resistance to chloride-induced corrosion is required. Stainless steels are basically iron-chromium alloys; the brunt of the protective film comes from sufficient chromium. Type 316 Stainless Steel contains 16 percent chromium and 10 percent nickel and two percent molybdenum.
Type 316 has broken down when exposed to saline water, seawater or brackish water. Sour gas can
Type 316 has broken down when exposed to saline water, seawater or brackish water. Sour gas can
y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
have high halide levels (excess benzyl halide and alkyl halide) which can accelerate the corrosion of ferrous metals. The 6Mo grade is 50 percent stronger than the 300-series and has very high resistance to stress corrosion cracking, pitting and crevice corrosion. The higher moly grade is generally found in desalination equipment, flue gas desulphurization scrubbers, chemical processing equipment and oil/gas production equipment.
Here’s the key point with this chemistry lesson. Because of the high nickel price, which is now approaching precious metals status, the austenitic structure of the stainless steel alloy can still be maintained, b
Here’s the key point with this chemistry lesson. Because of the high nickel price, which is now approaching precious metals status, the austenitic structure of the stainless steel alloy can still be maintained, b
.
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
ut with lesser nickel and more molybdenum. In other words, because of the tight nickel inventories, manfacturers have begun hunting for substitutes for this metal. In multiple energy-related situations, moly could find its way as a ‘substitution metal’ for nickel in stainless steel production.
Molybdenum strengthens the nickel matrix and extends service temperatures. In the extreme case, the nickel-based Alloy C-276® contains 15 to 17 percent molybdenum and is used for the construction of seawater-based flue-gas desulphurization plants. The higher moly content offsets the highly corrosive combination of seawater and sulfur-laden flue gase
Molybdenum strengthens the nickel matrix and extends service temperatures. In the extreme case, the nickel-based Alloy C-276® contains 15 to 17 percent molybdenum and is used for the construction of seawater-based flue-gas desulphurization plants. The higher moly content offsets the highly corrosive combination of seawater and sulfur-laden flue gase
elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.
Companies that provide selfless information through particip
Companies that provide selfless information through particip
s. As the major energy companies delve into the crummier fossil fuels, the sulfur content rises, thereby ultimately demanding a greater percentage of the molybdenum component.
From this aspect, there may be merit the molybdenum price can provide some excitement through the end of the decade and perhaps some promise for some, if not all, of the junior molybdenum exploration and development companies. Coupled with the roasting capacity problem, as we discussed in the previously referenced article, this molybdenum cycle offers more hope of longevity than the two previous spikes.
COPYRIGHT (C) 2007 by StockInterview, Inc. ALL RIGHTS RESERVED
From this aspect, there may be merit the molybdenum price can provide some excitement through the end of the decade and perhaps some promise for some, if not all, of the junior molybdenum exploration and development companies. Coupled with the roasting capacity problem, as we discussed in the previously referenced article, this molybdenum cycle offers more hope of longevity than the two previous spikes.
COPYRIGHT (C) 2007 by StockInterview, Inc. ALL RIGHTS RESERVED
tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products
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