Tight supply, strong demand to support 2022 Mo market

Spanish Market: Metals
02/12/21

Lower concentrate feedstock availability and a rise in demand from steelmakers is expected to support the molybdenum market in 2022, according to Li Shan, general manager of SinoMoly, a subsidiary of Jinduicheng Molybdenum.

Output from global key mining companies is expected to fall in 2022 because of lower metal grade in copper and molybdenum ore, harsh weather and a lack of workforce, Li told delegates at the 13th Luoyang Tungsten and Molybdenum Conference.

Global supplies will not increase owing to delays to new production projects. China will continue to carry out energy consumption curbs and environmental restrictions next year, which will offset steady output plans at domestic mines to leave a slight supply shortage.

Global demand for crude steel is forecast to reach around 1,896mn t in 2022, up by 2.2pc from 2021, including a rise of 5.5-7.1pc in Europe, Li said.

Renewed demand from other emerging downstream sectors, such as hydrogen energy, will indirectly support the molybdenum market in the coming year. The main steel product that involves molybdenum is 316L, which is used in the processes of hydrogen production, storage and usage.

Prices for molybdenum have held firm following a recovery in demand from steel sectors after the Covid-19 pandemic eased. Market participants expect global annual consumption in major economies in 2021 will be stronger than 2020. Purchases of ferro-molybdenum alloy from Chinese steelmakers in the first 10 months of this year rose by around 8pc to 9,500 t/month from a year ago.

Chinese prices started falling in September following consecutive gains during January-August, with steelmakers reluctant to purchase at higher prices in view of thin profit margins, especially when energy consumption curbs pressured the production and market activity of stainless steel. Molybdenum suppliers then cut their prices to attract sales.

The country exported 13,299t of ferro-molybdenum in January-October, up by 284pc from 3,462t over the same period of last year, official customs data show. Exports reached 1,851t in October, up by 343pc from 418t a year earlier and up by 3.70pc from 1,785t a month ago. Alloy suppliers also increased their shipments to overseas buyers in November.

Argus today assessed domestic prices for 60pc grade ferro-molybdenum at 138,000-142,000 yuan/t ex-works, or Yn230-237/kg ($36.10-37.19/kg) for contained molybdenum, up from the 30 November assessment of Yn135,000-138,000/t. Export prices remained stable from 30 November at $37-38/kg fob today.

Steelmakers have increased their replenishment efforts as the country's energy consumption curbs have eased and concentrate suppliers have held low inventories in recent weeks after concluding large volumes of deals at lower prices in November. Alloy prices are expected to hold firm in the short term in light of the increased purchases from steelmakers and tight concentrate feedstock availability, market participants said on the sidelines of the conference.

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01/04/25

Mexican peso weakness may partially offset US tariffs

Mexico City, 1 April (Argus) — Volatility in the peso/dollar exchange rate may help to partially offset any tariffs that US President Donald Trump decides to impose on imports from Mexico as the ensuing peso depreciation would make its exports more competitive, said analysts from US bank Barclays. President Trump will announce Wednesday his next decision related to the threat to impose a 25pc tariff against imports from its commercial partners Mexico and Canada. Trump has delayed the decision twice, and it is likely that he will do so again, given the serious repercussions the tariffs could cause to the US economy, said Latam chief economist at Barclays, Gabriel Casillas, during a webinar held Monday. The base scenario for Barclays is that Trump's administration will finally step back from imposing tariffs on Mexico and Canada and rather go for an early renegotiation of the (US Mexico Canada Free Trade Agreement (USMCA) this year, said Casillas. In this scenario, the Mexican peso would strengthen to between Ps19.5 to Ps19.00 to the greenback, he added. However, if Trump's administration decides to impose the 25pc tariffs on all Mexican imports as he has threatened to do, then the peso would weaken to Ps24/$1, said Erik Martinez, foreign exchange research Analyst at Barclays during the same webinar. "If tariffs were imposed, 25 percent on all imports, we think a good portion of this would be absorbed by the exchange rate," said Casillas. A weaker peso makes Mexican exports more competitive abroad. The Mexican peso on Tuesday was trading at around Ps20.30 to the dollar, and has weakened by 18.5pc in the past year from about Ps16.6 to the dollar a year ago. If President Claudia Sheinbaum's administration avoids the tariffs, the peso may strengthen to around Ps 19.00/$1 in upcoming days, said Martinez. If the tariffs are applied during a brief period or only for the automobile sector, the exchange rate could range between Ps21.00-22.00 per dollar, said Martinez. However, even without any tariff being applied, Mexico's economy is expected to grow only by around 0.7pc this year, less than the estimates made late in 2024 of around 1.4pc, due to the deceleration of the US economy, Mexico's main trading partner, said Casillas. The US economy is showing signs of slowing down, specially in the industrial sector, which will impact Mexico's growth for the year. Also, this uncertainty is directly affecting any upside expected from so-called nearshoring as companies would now lose interest in moving their manufacturing lines to Mexico if there is no clear benefit in using the USMCA to avoid tariffs, said Casillas. By Édgar Sígler Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US manufacturing contracts in March: ISM

01/04/25

US manufacturing contracts in March: ISM

Houston, 1 April (Argus) — Economic activity in the US manufacturing sector fell back into contraction in March after a brief expansion as businesses braced for US president Donald Trump's threatened tariffs on imports. The manufacturing purchasing managers' index fell to 49 in March, down from the 50.3 in February, the Institute for Supply Management reported Tuesday. That followed three months of expansion — above the breakeven threshold of 50 — following 26 months of contraction. The new orders index contracted for a second month in a row, falling to 45.2, down by 3.4 points from the prior month. Production fell to 48.3 from 50.7. New export orders fell to 49.6 in March from 51.4 the prior month. "Demand and production retreated and destaffing continued, as panelists' companies responded to demand confusion," ISM said. "Prices growth accelerated due to tariffs, causing new order placement backlogs, supplier delivery slowdowns and manufacturing inventory growth." The prices index surged to 69.4, up from 62.4 in February and the highest since mid-2022. Employment fell by 2.9 points to 47.6. The supplier delivery index fell by 1 point to 53.5, indicating ongoing slowing in deliveries and slowing demand. Trump plans to unveil sweeping "reciprocal" tariffs on major foreign trade partners on 2 April after previewing or announcing multiple tariff actions since taking office, including a 20pc tariff on all imports from China and a 25pc tax on all imported steel and aluminum that both took effect last month. Trump last month also announced a 25pc tariff on all imported cars, trucks and auto parts, scheduled to go into effect on 3 April. The measures, together with mass federal government layoffs and spending cuts, spooked US equity markets, which last month posted heavy losses. Comments focus on tariff confusion Comments from survey participants highlighted uncertainty over how Trump's tariff plans would effect operations and the economy. "Acute shortages continue to impact supply chain continuity," a transportation equipment executive said. "Chinese restrictions on critical minerals such as germanium have caused major shortages, resulting in all supply needed in 2025 already assumed — and, not surprisingly, significant price increases as a result." "Customers are pulling in orders due to anxiety about continued tariffs and pricing pressures," according to a computer and electronic products executive. "Business condition is deteriorating at a fast pace," a machinery executive commented. "Tariffs and economic uncertainty are making the current business environment challenging." "New order levels have increased and are better than expected," a fabricated metals executive said. "We suspect that our customers are trying to build inventory at current prices to get ahead of expected tariff and related cost increases." By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

ArcelorMittal raises NW EU HRC offer to €700/t

01/04/25

ArcelorMittal raises NW EU HRC offer to €700/t

London, 1 April (Argus) — European market leader ArcelorMittal has raised its hot-rolled coil (HRC) offer to €700/t base in the north. Its previous offer was €680/t base. The producer recently has seen an increase in enquiries and bookings, aided by the steel safeguard review. This trend has been most prevalent on HRC in the north, as well as cold-rolled and hot-dip galvanised across Europe. European mills have been in no rush to sell, with delivery performances under pressure from some as a result of low utilisation rates and issues at some producers causing backlogs. At the same time, mills expect import arrivals to fall in the coming months, although there could be some overhang this quota period, after the safeguard review and imposition of provisional anti-dumping duties on Egypt, Japan and Vietnam. In the futures market today, a fourth-quarter strip traded at €670/t, broadly in line with the settlement on 31 March. The physical market is largely quiet, as participants wait to see how much material clears today and what tariffs are announced by US president Donald Trump. North EU mill margins have nearly reached a year-long high in recent days, with the spread for NW EU HRC over blast furnace costs having reached €181/ on 31 March, the highest level since €189/t on 5 April. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

EU stainless safeguards, metal plan meet mixed reaction

31/03/25

EU stainless safeguards, metal plan meet mixed reaction

London, 31 March (Argus) — Europe's stainless steel industry has had a mixed reaction to the European Commission's safeguard steel review and its action plan to protect the bloc's metals industry, both announced on 11 March. Steelmakers have welcomed greater commitment from policy makers to support the sector, but are still concerned at a lack of concrete commitment to significant protectionist measures, while traders, service centres and scrap suppliers are worried the most radical proposals could severely damage their businesses. The European Commission's review of definitive safeguard measures on imports of certain steel products identified no new import pressure for stainless cold rolled sheets and strips, and left tariff rate quotas for the next 15 months virtually unchanged even as carryovers and unused quota access were removed. 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US consumer confidence down on policy angst

28/03/25

US consumer confidence down on policy angst

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