European ferro-molybdenum and molybdic oxide prices have hit four-year lows as market participants brace for an influx of material in the next year and slackening demand in China.

Metal Bulletin’s quotation for ferro-molybdenum dropped to $25-25.50 per kg, in-warehouse Rotterdam, and molybdic oxide was down to $10-10.10 per lb.

Indications were also reported at levels as low as $24.80 and $9.90, although no business has yet been concluded at these levels.

“We’ve not seen it like this since the financial crisis. Everybody was expecting China to be better this year,” a producer said.

“Consumption from China is not good, and they have huge stocks of steel. They’re not using the molybdenum they have, and of course, that affects the rest of the world.”

The market has also begun to price in increased production at various locations over the course of the next year to 18 months, he added.

“We’re not seeing any additional units yet, but they are coming from next year, and that puts a lot of pressure on the price now,” he said.

“Nobody knows where the bottom will be. I hope we’re near the bottom now because of production costs.”

Participants lack confidence in the future of the market, a trader said, and there is nothing to stop prices from sliding still further.

“Downstream consumption is not great, and sentiment is negative. It will be interesting to see how far it can go,” she said.

“There’s no appetite from China because of limited cash availability from banks. It keeps declining,” she added.

Claire Hack
Twitter: @clairehack_mb