Erdene Resource Development Corp (TSX:ERD) will cut back molybdenum production in Mongolia after prices fell 73 percent since November. This follows the decline in stainless steel demand for kitchenware and building decorations due to the worldwide economic crisis.

Erdene mines molybdenum at its Erdnet site in northeast Mongolia as well as coal exploration at its Greenfield site.

Molybdenum is an additive that provides strength, weldability and toughness to steel and is used in most items built with steel.

Erdene had been producing 20 million pounds of molybdenum annually, but will reduce production to five to six million pounds, according to Chief Executive Peter Akerley.

At the same time, Erdene will be looking for partners to finance molybdenum production. "We would be looking at somebody who would help with investing in the project through" supply agreements, Akerley said while attending the Asian Mining Congress. Erdene has held preliminary talks with a number of Chinese partners including China Molybdenum Co., he said.