What is the trend of the back market of Mo?
In the first quarter of this year, the overall price of Mo market at home and abroad rose steadily and fluctuated slightly. From January to March, the average price of domestic Mo concentrate (45% ≤ 50%) was 1673 yuan / ton, up 3.40% from the same period last year. The average price of Mo-Fe in China was 11.45 yuan / ton, up 2.51% from the same period last year, and the average price of Mo oxide in the international market was 11.795 US dollars / pound, down 3.63% from the same period last year. In the later period, under the support of continuous exuberance in demand and tight supply of raw materials, the domestic and foreign Mo market may continue to maintain a steady and positive trend in the second quarter. From the point of view of the domestic market, in the first quarter of this year, the domestic Mo market as a whole showed first suppression, then rise, and then stabilize the market. In January, the domestic Mo market as a whole showed the first suppression and then the promotion of the market. In February, the domestic molybdenum market as a whole presented a first rise and then a stable market. In March, supported by the demand gap of Mo concentrate, the market mentality was stable, the price was firm and rose slightly; because of the strong wait-and-see atmosphere in steel mills, the purchasing situation of Mo and Fe was not as good as expected, and the high level was slightly consolidated. From the point of view of the international market, in the first quarter of this year, the international Mo market as a whole showed first suppression, then Yang, concussion operation market. In the middle and early days of January, the price of the Mo market continued to decline, and then stopped falling and oscillated to pick up. Into February, due to rising domestic prices and Chileundefineds torrential rain and other multiple positive factors, the molybdenum market rose to a stable trend. In March, the international Mo market took the lead. At the beginning of March, the price of Mo oxide rose from US $12.10 / lb to US $12.80 / lb at its peak, and the price showed a trend of high consolidation and decline. According to CRU statistics, the output of molybdenum concentrate in 2018 is about 257600 tons, which is 0.19% lower than the same period last year. World molybdenum production is expected to be 65800 tons in the first quarter of 2019, down 0.15 percent year-on-year. According to the output of major countries, the output of Mo in the United States was 10400 tons, up 3.32% from the same period last year, the output of Mo in Chile was 13700 tons, down 10.18% from the same period last year, and the output of Mo in Peru was 8400 tons, an increase of 31.01% over the same period last year. Mexicoundefineds molybdenum production was 3600 tons, up 3.90 percent year-on-year, while Chinaundefineds 22500 tons, down 4.30 percent from the same period last year. China remains the worldundefineds largest producer of molybdenum, accounting for about 34% of global production. In the first quarter of 2019, Chinaundefineds molybdenum concentrate output was 51457 tons, an increase of 7.4 percent year-on-year, according to production in China. From the point of view of the main Mo-producing areas, the output of Inner Mongolia decreased in the first quarter of 2019 compared with the same period last year, while the output of Henan, Shaanxi, Heilongjiang and Hebei increased to a certain extent compared with the same period last year. Among them, Henan Province produced 19031 tons, up 7.7 percent from the same period last year; Shaanxi Province produced 9266 tons, up 10 percent from the same period last year; Heilongjiang Province produced 7800 tons, up 5.4 percent from the same period last year; Inner Mongolia produced 6455 tons, down 12.7 percent from the same period last year. The output of Hebei Province was 3380 tons, up 138 percent from the same period last year, Jilin Province was 1550 tons, down 10.4 percent from the same period last year, and Jiangxi Province was 1810 tons, down 7.5 percent from the same period last year. From the point of view of the distribution area of Mo concentrate production, the output of Mo concentrate in China in the first quarter of 2019 was mainly concentrated in Henan, Shaanxi, Heilongjiang and Inner Mongolia provinces, accounting for 36.98% and 18.01% of the total output, respectively. 15.16% and 12.54%, accounting for 82.69% of the countryundefineds total output.
In the first quarter of 2019, the volume of molybdenum concentrate trading in China was 21627 tons, an increase of 7480 tons, or 34.59%, accounting for 41.33% of the total production of molybdenum concentrate in China in the first quarter of 2019. This shows that about 41% of domestic molybdenum concentrate production is used in market circulation and 59% in self-processing of enterprises. From the point of view of Mo concentrate trading market area, Heilongjiang, Henan, Inner Mongolia, Hebei and other areas were still active in the first quarter of 2019, accounting for 29.89% and 20.07% of the total trading volume of Mo concentrate in China, respectively. 16.36 percent, 12.53 percent, accounting for 78.85 percent of the countryundefineds total trading volume. This is mainly due to the fact that the output of molybdenum concentrate in Henan and Shaanxi is the highest in the country, but the main enterprises, such as Jinduicheng, Luo Mo and other integrated mining enterprises, are mainly self-processed and hardly sell molybdenum concentrate to the outside world, while Heilongjiang and Inner Mongolia, The molybdenum concentrate produced by the molybdenum mine enterprises in Hebei and other places is almost all used for sale to the outside world. According to incomplete statistics, domestic production of molybdenum and iron in the first quarter of 2019 was 36948 tons, up 3.36 percent year on year. Among them, the output of ferromolybdate in Liaoning was 23613 tons, up 12.77% from the same period last year, accounting for 63.91% of the total output in China, while the output of ferromolybdate in Henan was 7901 tons, down 15.68%, accounting for 21.38% of the total output in Henan. Shaanxi output was 5154 tons, up 4.0 percent year-on-year, accounting for 13.95 percent of the countryundefineds total output. The total production of molybdenum and iron in the above three regions accounted for 99.24 percent of the countryundefineds total output, while the production of molybdenum and iron enterprises in other regions was almost completely shut down due to environmental protection factors. In March 2019, the amount of molybdenum and iron in the main domestic steel mills was 8260 tons, an increase of 10% from the previous month. From January to March, the total amount of Mo and Fe invited by domestic mainstream steel mills was 22243 tons, an increase of 27.35% over the same period last year. In March 2019, the average bidding price of Mo and Fe in steel mills was 117000 yuan / base ton, an increase of 2.90% and 7.34% respectively. From January to March, the average price of molybdenum and iron was 109400 yuan / base ton, down 1.50% from the same period last year. In recent years, Chinaundefineds molybdenum production has increased significantly, but demand has continued to increase. At the same time, due to the balance of supply and demand at home and abroad and the influence of prices, Chinaundefineds molybdenum production in the first quarter of 2019 was 22500 tons. Consumption of 19500 tons, considering import and export trade, the overall market is expected to be in a weak equilibrium, prices basically fluctuate near the cost line.
It is expected that in the second quarter, molybdenum market is steadily improving in March, demand in the steel market will recover relatively slowly, production in steel mills will be tightened, inventory consumption will accelerate, and production costs of enterprises will decrease, but the current market sentiment is more cautious. The forecast index of production and business activity fell 7.9 percentage points to 55 percent from a month earlier. Downstream steel industry fixed asset investment growth rate has also increased or decreased. From January to February, crude steel production from member companies totaled about 21.039 million tons, down 2.53 percent from the same period last year, according to the China Special Steel Enterprise Association. Low alloy steel output was 7.141 million tons, up 2.64 percent, and alloy steel output was 5.386 million tons, down 13.3 percent. In alloy steel, the output of high quality alloy steel is 1.053 million tons, up 3.16%, and that of special quality alloy steel is 4.334 million tons, an increase of 16.53%. According to the statistics of the China Construction Machinery Industry Association, 25 mainframe manufacturing enterprises included in the statistics from January to February 2019 sold a total of 30501 sets of mining machinery products, an increase of 39.9 percent over the same period last year. Among them, domestic market sales of 27400 units, up 42.2 percent from the same period last year; export sales of 3073 units, an increase of 21.8 percent over the same period last year. From the point of view of the Mo industry, the overall Mo market at home and abroad performed well and traded actively in the first quarter of 2019, and the prices of all kinds of products rose to varying degrees compared with February. In the later period, it is expected that the domestic and foreign molybdenum market will continue to maintain a stable and positive trend in the second quarter under the support of multiple favorable factors, such as continuous exuberance of demand and tight supply of raw materials. Among them, the supply of Mo concentrate market may increase slightly, the demand of Mo Fe will continue to be exuberant, Mo chemical industry, deep processing market may continue to be stable and good. Molybdenum oxide prices are expected to remain above $12 / lb on the international market.
