molybdenum price to climb further

Molybdenum price forecast strengthens
Investment advisers have now joined market analysts in suggesting that molybdenum could rise by as much as 12.5% in 2008. As reported earlier by Purchasing.com, the nonferrous metal’s prices could rise in 2008 to an average $36/lb from $32 this year because of a 5% or higher decline in new-metal supply.

In last Friday’s episode of CNBC’s “Mad Money” show, host Jim Cramer said that molybdenum, “the chemical that makes steel even stronger,” is a hot commodity these days. Otto Spork, the portfolio manager with Sextant Capital Management, a Toronto hedge fund, tells the Globe and Mail newspaper that he is upbeat on moly, a nonferrous alloying metal with such industrial uses as strengthening steel and removing sulphur from crude oil.

Molybdenum prices sat at an average $3.50/lb between 1982 and 2003 before a steady upward movement that has brought the 2004-2007 average close to $26. In recent months, prices have ramped up to a $32 average and Spork says “there is going to be more upside” in the months ahead. That’s because of his belief that world steel production will grow yet again in 2008.