Molybdenum prices have recently been rangebound amid supply glut dynamics and tariff imposition by North America on Chinese imports

Molybdenum Prices have been relatively stable with limited upward movement. The Chinese spot market for flat-rolled stainless steel, particularly grade 304, has remained steady since mid-August. This stability comes as demand rises, marking the beginning of the peak season. Inventories of the 200, 300, and 400 series stainless steel have decreased by up to 1.23%, signaling stronger market activity. Additionally, easing inflation in the US and eurozone could lead to interest rate cuts by the Federal Reserve and European Central Bank, potentially affecting the broader steel market.

In the first half of 2024, CMOC Group Limited, which is listed in Shanghai and Hong Kong, reported a molybdenum output of 7,349 tonnes, a 12.4% drop compared to the same period last year. This decrease, combined with sufficient supply in the stainless steel market, is reflected in the LME inventory. Tariffs on Chinese steel, including the upcoming 25% tariff by Canada starting in October 2024, may further influence the market. The tariffs are expected to raise the costs of imported Chinese steel, stainless steel, and aluminum, affecting supply dynamics.

The North American region, in particular, is seeing tighter supply due to tariffs, with the United States and Mexico extending Section 232 tariffs on steel and aluminum. These protectionist measures are expected to add price support for molybdenum in the region. However, with China being a major stainless steel supplier, molybdenum prices may stay relatively stable globally, as the demand for stainless steel plays a key role in molybdenum pricing.

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For the next few months, molybdenum prices are expected to rise due to increased construction activity during the fall peak season. This trend is likely to continue through October, though a slight decline in prices may follow in November as construction slows and the demand for stainless steel tapers off.