In which I am intemperate

An email correspondent writes to query a piece out there about molybdenum prices. They’re rising. They’re rising because China demand. So, what oogieboogie is China up to to drive the price of molybdenum up and thus murder us all in our beds?

My response is less than temperate:

That’s a particularly stupid piece.

The answer is in there he just doesn’t recognise it.

China’s steel production is booming. We can see it in the iron ore price. It’s a part of the Chinese stimulus plan through infrastructure. The major use of Mo (80% of total) is in FeMo for steel making. There is no mystery here.

More steel means more FeMo use means more Mo use.

Now, if China was buying up metallic Mo, the major use of which is in superalloys – ie those not containing iron – then we’d have an interesting question. But that ain’t what’s happening.

4 thoughts on “In which I am intemperate”

  1. Bloke in North Dorset

    I was listening to an economics professor talking about something similar recently. He was saying that current MBA students think that price rises are only caused by monopolies and that this is a refl3ction of thinking in the general public and politicians. He gave an example of one of his students complaining about timber price rises at his local build merchants.

    He reckoned it took him 5 minutes to link it to increasing numbers in house construction.

  2. At the moment, it looks as if most metals are rising in price and the answer in almost all cases is CHINA. It’s not hard to understand. For the last decade, China has been taking stakes in mining companies around the world, even in the saintly EU. One wonders why. Even 15 years ago, I heard a lecture in which someone said that 80% of the cranes in the world were in China. Now that the EU and USA don’t allow metal smelting, who else is going to be buying metals?

  3. I understand that the Chinese are so short of iron ore that they even buy some from awful Oz. No shortage of coal on the international market though.

  4. Even super green trendy Vancouver, birthplace of Greenpeace, has a large coal yard right on the coast for shipping coal to Asia. The bulk of exports is metallurgical coal.

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