TEX reported that China's trade balance of molybdenum in August 2011 was export surplus, i.e., on molybdenum metal content basis, exports: 2.10 million pounds, imports: 1.88 million pounds. The balance had been export surplus during the first five months of 2011, until May, but in June and July it turned to import surplus. August was the month of export surplus again since May.

In August, exports increased by 39.3%, while imports increased only modestly by 5.1%. During the eight months of 2011 total exports were 17.20 million pounds and total imports were 10.47 pounds. Compared to the last year's figures during the same period, exports were down by 13.8%, and imports were down by as much as 52.7%, a big drop down to nearly a half.

It is thought that, despite the fast increasing demand for molybdenum mainly from domestic special steel producers, the reason why imports of molybdenum have become such poor is that the supply structure is thoroughly changing, in which the growth of demand in China is basically supplied by domestic molybdenum producers on domestic resources.

The export surplus in August could mean that dealers in China tried to clear their stocks or to avoid keeping stocks under the weakening international market. This trend may continue if demand stays sluggish.

(Sourced from TEX Report Limited)