Production details of molybdenum concentrates during the nine months of 2011 in the western world is as per the table attached hereto, which shows that, on molybdenum content basis.
North America produced 119.27 million pounds of molybdenum concentrates during the nine months of 2011, up by 18.7% from the same period of 2010; South America produced 84.94 million pounds, up by 8.3%, making a total western world production 204.21 million pounds, up by 14.2% YoY.
Among the producers in North America, Kennecott produced 25.13 million pounds (up by 31.0% from the same period of 2010), Freeport McMoran produced 65 million pounds (up by 22.6%). Two majors in the region both substantially increased output and are to expand further within the next two years.
Under the current situation surrounding molybdenum that its price is heading down, the two do not seem to have given up the original plans of expansion, so production of molybdenum concentrates will most probably continue to grow. Thompson Creek Metal during the nine months was constant and with little fluctuation in monthly output.
In South America, Codelco in Chile forecasts its 2011 annual production will be 48.0 to 49.0 million pounds (45 million pounds in 2010), while Collahuasi of Xstrata in Chile plans to produce 14.0 million pounds in the full year of 2011.
Output of molybdenum in concentrates in the western world, mostly in the Americas, was predominantly from the South over the North, but since the price rose to USD 14 per pound Mo or more, output from the North has been more than from the South.
Freeport's new Climax mine in Colorado in USA is scheduled to start production in 2012 with a production plan to ramp up to 2 million pounds in 2013, the two thirds of its designed annual production capacity. This, together with Kennecott's expansion plan, will keep the North predominant over the South in the coming years.
Quarterly production in 2011 was in uptrend in the first half, i.e. 66.88 million pounds in January to March and 71.69 pounds in April to June, but, due to the much lower output at Thompson Creek, the production in the third quarter (July to September) dropped.
China's trade balance of molybdenum on quarterly basis in 2011 was, export surplus in the first and second quarters and import surplus in the third quarter. Total balance during the 2011's nine month period was export surplus by 4.45 million pounds. Background of these figures is that the country put a brake on the imports of molybdenum this year. Actually the imports to China this year up to September fell to almost the half of the imports in the same period of 2010. In other words, their imports in 2011 from the western world were much smaller than those in 2009 and 2010.
This year's price decline from USD 17 to USD 18 per pound Mo of early this year to USD 13 per pound Mo in November is mostly because the western world producers, simply expecting China's big appetite to grow even further, continued rather high level of production.
(Sourced from TEX Report Limited)
