I dont know why people still listen to analysts and forecasters. They know nothing and are always wrong. Here is a report from 3 months ago. Every analyst is 100% incorrect on the price.
Analysts reduce molybdenum price forecast Mon, May 18, 2009 Featured Articles, Moly Articles
Analysts forecast a tough Q2 for moly prices By Leia Michele Toovey- Exclusive to Moly Investing News
As a minor metal, molybdenum is prone to rapid price fluctuations; in the past this had generated huge returns on investment. Molybdenum was one of the last metals to feel the effects of the economic downturn, but has failed to match the recovery experienced by many metals since the start of the New Year.
Despite a positive turn to most metal’s prices in 2009, molybdenum has continued its downward descent, falling in 11 of 13 weeks in Q1. The monthly Platts Metals Week published molybdenum oxide price averaged US $8.94 per pound during the quarter. For the month of April 2009, this published price declined further to an average US $7.90 per pound. Molybdenum oxide prices averaged just under US $29 per pound in 2008.
Analysts have pegged that in the near future the market price of molybdenum will drop, in parallel with the sharp drop in steel production. As a result, analysts are reducing long-term price forecasts for molybdenum because of expected weak demand this year. Anthony Young at investment bank Dahlman Rose & Co. cut his forecast to $10 per lb this year from a previous prediction of $12 and lowered the estimate for next year to $12 from $15. Meanwhile, a less bullish Mike Gambardella at JP Morgan Chase sees molybdenum averaging around $8 per pound this year and $11.50 in 2010.
Low steel production means stockpiling molybdenum inventories. Even though moly is not actively traded on an exchange, producers have reported difficulty in ridding themselves of the metal. Moly market fundamentals remain week, with pick up in demand a China only story. China became a net importer of molybdenum this year, and in March alone imported more molybdenum concentrate and molybdic oxide than it did in all of 2008. Chinese molybdenum imports skyrocketed 876 per cent to 14,447 tonnes in the first quarter of this year, while exports sank 69 per cent.
MOL Price at posting:
95.5¢ Sentiment: Buy Disclosure: Held
