lme listing

It seems the London Metal Exchange is going ahead with its intensions to trade Molybdenum and Cobolt.

They are talking a matter of months.

What this potential means is the following:

1. New projects will able to sell forward their production thus making it easier to get finance from lenders.

2. Speculative money will flow into trading Molybdenum making it a far more liquid but volatile market. So when things are hot, the price will tend to get above market fundamentals and when it reverses then you will see what has just happened to Nickel and Zinc etc (40% price collapse).

Given Moly does not have hot money in its sedate market, its may be that there will be short term sharp increase in the price in addition to the fundamentals of demand outstripping supply which is what we are experiencing now.

In any case, it seems like a positive move overall especially for projects looking for funding from banks.