RE: MoO3Here is a rough description of the process. It comes from an article from 2005. (Note the price prediction of $15 through 2007.) Currently moly is selling in the low 30's, nowhere near the 50 that one poster suggested. Most analysts forecast that it is stable there for the time being. The roasting capacity situation has not changed. It still represents a significant bottleneck. Do the math accordingly.
Useful url's
https://metalsplace.com/news/?s=61
https://www.infomine.com/investment/historicalcharts/showcharts.asp?c=Molybdenum
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Two years ago, a bottleneck development in the roasting of molybdenum. According to William G. Cook, who is the North American representative for Derek Raphael & Company, presently the world’s largest molybdenum trader, “The roasting sector has not been able to keep pace with the rapid increase in moly demand.” He explained this was a concern, “Roasters are very expensive to build and are environmentally sensitive so this is an area to focus on in the future when evaluating the moly market.”
“The molybdenum industry does have the ability to produce more moly,” Michael Magyar told StockInterview, “but we can’t roast much more moly right now.” Magyar is the molybdenum commodity specialist for the United States Geological Survey (USGS), based in Reston, Virginia. He explained that increased molybdenum in steel demand could create another bottleneck at the roasters. Worse yet, he added, “No one is actively permitting for more roasting capacity in North America.”
This may help explain why some analysts are bullish on molybdenum. On Monday, Salman Partners Raymond Goldie wrote, “Molybdenum, like copper, nickel and zinc, is also enjoying prices which are remarkably high and remarkably sustained.” The Toronto-based senior mining analyst updated his long-term forecasts for molybdenum prices. But not all analysts are bullish on moly. Citigroup Global Commodities Analyst Alan Heap predicted molybdenum prices would head lower the next few years. In his half-yearly estimates, the Sydney, Australia-based analyst estimated molybdenum would average $15/pound through 2007.
Cook summed it up, “I don’t see much change (in the moly price) looking forward to 2007. I think the market will still be strong.” Magyar was blunter, “The price is not trending anywhere. It’s just drifting around $25/pound.”
Roasting Molybdenum
After molybdenum is mined, it goes through several more steps before being refined into Technical Molybdenum Oxide. Before the moly can be roasted, it must first be milled, dipped into a floatation cell and leached.
First the large chunks of ore are crushed into gravel. Next, the material is ground down into powder. Molybdenum is floated into aerated tanks to produce a molybdenum sulphide concentrate. Acid leaching may be required to dissolve copper and lead impurities remaining in the material.
And then the molybdenum sulphide is roasted in multi-level hearth furnaces at temperatures up to 650 degrees centigrade to become ‘roasted molybdenite concentrate.’ The roasting process gets rids of the sulphur. Large rakes are used to move around the concentrate to stir up the ‘exothermic’ process, against a current of heated air and gases blowing up from the bottom of the hearth. Literally, the sulphur burns itself off the molybdenite. The material starts at the top, falling down level after level, burning more sulphur off at each of about one dozen levels, until the roasted final product arrives at the bottom. The gases are scrubbed separately and converted to sulfuric acid, later sold in Chile’s domestic market.
Annually, MOLYMET produces about 46 million pounds of molybdenum concentrates, more than 10 percent of the world’s production. The Chilean company plans to add another 40 million pounds of roasting capacity in 2007 to accommodate the growing demand for molybdenum. “The new roasting capacity could accommodate new production of about 12 to 15 million pounds per year – about what we would expect if the moly market continues growing at three to four percent per year – that’s three years growth in mining production,” Magyar explained. “That will use up MOLYMET’s new roasting capacity in about three years.
By 2009, MOLYMET in Belgium will add 10 million pounds of roasting capacity. But is that enough molybdenum to meet the current percentage growth rate of the market? “After 2010, we may need more roasting capacity,” Magyar said. “I don’t see where the roasting capacity will come from. We will likely need additional roasting capacity if the market continues to grow by 3 to 4 percent annually.” He advised, “We could need another MOLYMET (with 100 million pounds of roasting capacity) if the current growth continues.”
In the United States, there are three states where molybdenum can be roasted: Arizona, Iowa and Pennsylvania.
No New Mines, Producers Falling Short The moly market is tight. “Supply is in balance with demand, but there is not enough excess supply to rebuild inventories,” Magyar observed. “Inventory is still below historic levels.” Prices are impacted by production. “New production that was anticipated, particularly during the first half of 2006, has not materialized,” William Cook told us. “We have yet to see one pound of new production coming from a number of mines we had anticipated.”