Spot moly prices rise in northeast Asia on European buying spree Tokyo (Platts)--22Dec2010/804 am EST/1304 GMT
Spot prices for molybdenum oxide in northeast Asia have risen to $16.20-16.40/lb CIF Japan/Busan from $15.90-16.00/lb CIF last week, on strong buying interest from European traders, market sources said Wednesday.
One South Korean regular spot buyer said offers were as high as $17/lb CIF Busan as sellers expect higher prices next month, on the back of tightening spot supply in Europe.
A government in Asia is said to have purchased around 500 mt of moly oxide this month, decreasing spot availability and thereby hitting European consumers and traders who rely more on spot supply, some sources estimated.
One European trader bought from a Korean trader 20 mt of moly oxide at $16.50/lb in-warehouse Rotterdam. But Asian buyers were paying 20-30 cents/lb less. Two Korean ferromoly plants and one trader reported buying a total of 100 mt at $16.10-16.30/lb CIF Busan from China.
Supply of ferromolybdenum, which is produced from moly oxide, appears to be tightening too.
One South Korean ferromoly plant, producing over 200 mt/month, said his company has sold out all productions until February, due to strong buying interests coming from Europe as well as from local steelmakers.
"There are more and more inquiries for January shipments from Europe.
They don't have cargoes at Rotterdam," said the Korean trader.
Korean ferromoly plants have sold to Europe mostly at $39.50/kg CIF Rotterdam this week, unchanged from the previous week. But some see prices rising above $40/kg in coming weeks.
Two local steelmakers -- Posco and Posco Specialty Steel -- have issued purchase tenders for a total of 100 mt of ferromoly this week. One mill was seeking 20 mt more, but had not been able to source its requirement due to lack of sellers, said one supplier source.
Some also cited recovery in global carbon and stainless steel demand in the coming quarter for the higher moly products prices. Some, however, had disagreed.
Scrap stainless steel supply remains abundant and remains a buyer's market, said one mill source.
Spot prices of ferrochrome, used with moly for production of SUS316 grade stainless steel, have not moved up.
A Japanese trader reported a $1.04/lb CIF Japan deal for 300 mt of high carbon Indian-origin 60% ferrochrome, for February shipment. A second Indian seller was offering $1.11/lb CIF Japan last week
MOL Price at posting:
$1.09 Sentiment: Hold Disclosure: Held
