Analysts are forecasting molybdenum prices to trend up in 2014,
while user demand has already begun to improve, KGHM
International Ltd head of molybdenum sales and marketing Kevin
Molybdenum prices are
currently tracking below not only the five-year average but
also the 20- and 100-year averages when adjusted for inflation,
Pritchett told delegates at AMMs 27th Annual
Stainless and its Alloys Conference in Chicago.
forecasts from CIBC which estimated molybdenum prices to
average $12.25 per pound in 2014, rising to $12.52 per pound in
Molybdic oxide is
currently trading in a range of $9.40 to $9.60 per pound,
according to AMMs most recent assessment.
Pritchett said that
molybdenum demand has improved in the third quarter, and he
predicted the trend would continue with the recovery in such
sectors as automotive.
"Earlier in the year
you had companies keeping lean inventories and in the summer we
had producers selling into the downturn of the moly price,
getting a little panicky. Now it seems a little overdone. We
have a perception that the moly market is kinda short right
now," he said. "We should see some strengthening of the moly
price once demand gets to a normal level."
KGHM has a 55-percent
stake in the Sierra Gorda copper-molybdenum mine in Chile,
which is expected to produce about 50 million pounds of
molybdenum per year in its first five years of operation,
note: Due to a reporting error, the original version of this
article incorrectly stated that KGHM International Ltd.
expected molybdenum prices to begin to trend upward amid
improved user demand in 2014. KGHM doesnt forecast
prices. The price forecasts referenced by Kevin Pritchett, head
of molybdenum sales and marketing, were made by CIBC and not
endorsed by KGHM. The projected molybdenum production volume
from the Sierra Gorda copper-molybdenum mine in Chile, which
was misstated in the same article, is 50 million pounds over
the first five years of production.