Molybdenum Mining: Rising Demand and Supply Challenges in the Global Market

Researched by Industrial Info Resources (Sugar Land, Texas)--Owing to the rising demand from sectors like steelmaking, automotive and aerospace, the molybdenum mining industry is attracting substantial investments globally. Molybdenum, a silvery white metal, is known for its high strength, corrosion resistance and ability to extreme temperatures and therefore is utilized in many industrial applications.

The continued expansion of the steel industry, especially in emerging markets, is driving the demand for molybdenum. The demand is further bolstered by the automotive and aerospace sectors, which rely on high-performance materials for the manufacturing of their components. Additionally, molybdenum is used in various renewable energy technologies, including solar, wind, hydrogen, geothermal and hydropower, and helps improve efficiency, durability and performance in these applications.

While the demand for this critical element remains strong, the supply side remains relatively constrained globally. Molybdenum deposits are largely concentrated in only a few regions, such as China, Chile, the U.S. and Peru. China is the largest producer of molybdenum accounting for more than half of the global supply, followed by Peru (16%), Chile (15%) and the U.S. (12%). The mineral is extracted from molybdenum sulphide, the only commercial-grade deposits which are found in various concentrations in ores, especially copper. Only a few mines focus on molybdenum alone while most get it as a byproduct while mining for copper. Around 90% of molybdenum supply in the West comes as a byproduct from copper (accounting for 65% of the market); however, there are concerns about how aging copper mines and low copper prices might affect the overall supply of molybdenum.

The supply is further constrained by government restrictions and strict environmental regulations to adopt sustainable practices and mitigate their negative effects on the environment.

Because of supply concerns, molybdenum is classified as a critical mineral in countries like Australia, Canada, Japan and China, consequently driving companies to make substantial investments to ensure a steady supply of molybdenum.

Industrial Info is tracking around 33 projects, worth US$11.70 billion, aimed at molybdenum ore mining. Of this spending, 53% accounts for grassroot projects, while 11% is aimed at both unit additions and plant expansions, respectively. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for a full list of projects.

Around 67% of the total investments are in the planning phase, with around 14% in the engineering phase, and around 18% undergoing construction. The majority of the projects are scheduled for completion between 2025 and 2033.

By region, North America is the leading investor with spending worth US$5.94 billion, followed by Asia with investments of US$2.86 billion. South America and Oceania both are driving investments, with each accounting for a little more than US$1 billion.

By country, China, the U.S. and Canada are the top spending drivers. With investments worth US$3.31 billion, China is the dominant player. The U.S. and Canada follow with investments around US$3 billion and US$2 billion, respectively. Chile and Australia are also driving significant spending, with up to a little more than US$1 billion each.

New Moly LLC (Denver, Colorado), Anhui Geological Mining Investment Company Limited (Hefei, China), Caravel Minerals Limited (Australia) and Chevron Corporation (NYSE:CVX) (San Ramon, California) are the prominent players in the market, accounting for 67% of the total investment.

New Moly LLC is the leading investor with investments around US$2 billion and is planning to construct the Grassroot Mount Hope A-G Molybdenum Mine & Mill in Eureka, Nevada, to produce 35 million pounds per year. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for the project report.

Anhui Geological Mining Investment Company Limited also is making a substantial investment of more than US$1 billion, aimed at the Luan Grassroot U-G Shapinggou Molybdenum Ore Mine & Concentrator in China, to produce a capacity of 10 million tons per year of molybdenum. Click here for the project report.

Caravel Minerals Limited is investing around US$1 billion toward the Calingiri Grassroot Caravel A-G Copper-Molybdenum Mine & Processing Plant in Australia to provide a total processing capacity of 30 million tons per year. Click here for the project report.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).