Molybdenum ("moly") is a metallic element used primarily as an alloy in steel manufacturing. Moly-enhanced stainless and construction-grade steels are stronger and more resistant to heat and corrosion than other types of steel. Moly is also used to remove sulfur from liquid fuels in the petroleum refining process. There is nothing quite like moly. Its unique properties make it a necessary and irreplaceable element in a growing number of steel and other applications.

Mining for Moly

Molybdenum is produced through bulk mining. Primary moly mines produce only molybdenum. Moly can also be a by-product of copper mining, which accounts for approximately 60% of the world's moly supply. General Moly will be a primary producer of molybdenum.

Global Demand

Worldwide demand for molybdenum has been robust.  Between 2005 and 2007, demand grew at an average of 8% per year.  Although the global economy has slowed substantially in 2009, steel industry participants continue to view the underlying demand fundamentals of the moly market positively.  CPM group, an independent market consultant, expects demand growth to rebound substantially to 6.0% in 2010, as evidence suggests that large moly-intensive steel projects have simply been deferred, rather than cancelled.  This global demand is largely fuelled by infrastructure development in China and India.  The market is expected to remain in deficit until 2012, when Mt. Hope is forecast to begin production.

Industry Trends

• "New World" steel producers taking an increasingly integrated view toward raw material sourcing
• "Old World" producers (US, Europe, Japan) less focused on integration
• China exporting record amounts of steel, little raw materials
• Asian producers increasingly wary of relying on Chinese raw materials
• Power and labor issues at South American copper mines impacting moly delivery to market
• London Metal Exchange to launch moly contract in second half 2009