The imports of molybdenum into China in April of 2009 were known and still indicated the high level. The total quantity (on material base) of main three molybdenum products (molybdenum oxide, molybdenum sulfide and ferro-molybdenum) imported by China in January - April of 2009 came to 21,975 tons, corresponding to 27.2 million lbs. on Mo content base. For a reference, China imported 2,160 tons in material of molybdenum products, corresponding to 2.4 million lbs. on Mo content base, in January - April of 2008.

The monthly quantities (on material base) of molybdenum oxide imported by China in January - April of 2009 were <> January : 1,337 tons, <> February : 3,535 tons, <> March : 6,438 tons and <> April : 6,301 tons, having suddenly increased from March, and a scale in imports of molybdenum oxide into China enlarged by approximately 10 times in comparison with the exports of molybdenum products (exported 2,326 tons on material base in January - April of 2009). The exports of molybdenum products from China have been hampered by such barriers as high export duty, allocation system for quantity to be exported from China, and so on.

The world consumption of molybdenum in 2009 is estimated to decrease by 15 - 20% compared to that in 2008 but, as regards the temporary demand for molybdenum from China, various opinions have been seen. However, it is no doubt that China had endeavored to purchase molybdenum at the lowest possible prices in the middle of April, when market price of molybdenum oxide had fallen to a level of US$7.50 - 7.70 per lb. of Mo.

The international price of molybdenum oxide has bottomed out from the beginning of June and risen by 33% to a level of US$10 per lb. of Mo. The reason, why China has suddenly increased their imports of molybdenum products, is not speculation but rather due to the matter to replace molybdenum produced in China at high prices with those imported from overseas sources into China at low prices. The cost to produce molybdenum oxide in China as of May of this year is estimated to be on the line of US$11 - 12 per lb. of Mo and, therefore, a dangerous water area for price of molybdenum oxide has been thought as US$10. However, the current price of molybdenum oxide to be workable has risen to a level of US$13 per lb. of Mo.

A recovery in production of Chinese stainless steel commenced from April to May of this year has become a factor to push up price of molybdenum oxide. The output of crude stainless steel in China for 2009 is anticipated to decrease from that for 2008 but an opinion of this point has recently changed to a scale of 7 million tons per annum in 2009, having maintained a similar level to that in 2008.

China has replaced domestic production of molybdenum with the products imported from overseas sources until the first half of 2009 but, in expectation of these matters which stainless steel production in China will recover more and molybdenum prices are anticipated to rise further, there is a big probability that China will continue to import molybdenum. Therefore, market price of molybdenum oxide is thought to rise to US$13 per lb. of Mo as a target.

The molybdenum production in 2009 has been strategically reduced but, at the stage which LME copper price has risen to a higher level than US$5,000 per ton, molybdenum produced as by-product has put a remarkable impact on the market. An expansion in copper production is not negligible to accelerate a tendency to increase recovery of molybdenum but, when market price of molybdenum oxide has risen to a higher level than US$10 per lb. of Mo, it is questioned whether molybdenum credit is favorable for copper mining companies or not.

According to the settlement of accounts released recently by Antofagasta, the effects of molybdenum credit in copper production were (1) in full year 2008 : 59.2 US-Cents per lb. of Mo, (2) in January - March 2008 : 83.2 US-Cents and (3) in January - March 2009 : 20.4 Us-cents. Molybdenum credit was very useful to reduce the cost for copper production in the past years but this contribution to the cost for copper production has currently fallen to a large extent. Nevertheless, molybdenum credit is still an indispensable factor for copper mines. Many of the parties concerned have a view that, on the opportunity of a rebound in copper price, the quantity of molybdenum to be recovered as by-product will increase again.

For a reference, the world consumption of molybdenum in 2009 is estimated to be in the range of 370 - 380 million lbs. on Mo content base, which will shrink by 17% from that in 2008, but the quantity of molybdenum imported by China in January - April of 2009 has already reached 27.2 million lbs. on Mo content base. Under the situation which the demand for molybdenum in Europe and the USA has been still depressed, the movements in imports of molybdenum by China are not negligible.