The reasons are clear: it is the price of molybdenum that is the deciding factor. In February this year, when Chile moved to increase their exports of molybdenum, market price of molybdenum oxide was US$ 8.83 per pound of Mo, having fallen to the lowest level in the last five years.

After that, price of molybdenum oxide continued to fall in March and April, and the lowest oxide price in April was US$ 7.70 per pound of Mo. Following this however, the price of molybdenum oxide has recovered slowly.

Molybdenum prices have averaged slightly more than $9/lb so far this year.

An analysis by J P Morgan Securities warns "expect moly prices to close in on $15/lb over the next several months and to average $18/lb in 2010."

The forecast from New York-based analyst Michael Gambardella also suggests that "most Western molybdenum producers have little to no inventory," leaving traders scrambling. Restocking by carbon and stainless steel producers in the developed world and still-healthy demand from China "should then lead to the next step-up in moly prices to $20/lb in the fourth quarter of next year."