Taiyo Koko Forecasts Global Mo and V Oversupply in 2009

Supply and demand balance of rare metals for steel making is loosing globally. Taiyo Koko, Japanese major refiner of molybdenum and vanadium, forecasts global molybdenum supply could become surplus against the demand in 2009 by maximum 60 million pounds (approximately 27,000 tonnes), though the supply and demand were almost balanced in 2007 and 2008. Molybdenum consumption is expected to drop down in 2009 due to steel makers’ output reductions. Taiyo Koko also forecasts global vanadium supply would become surplus against the demand in 2009 by max 57 million pounds (approximately 25,600 tonnes).

Taiyo Koko assumes special steel and stainless steel makers would continue output reductions by 30% in 2009. Based on this assumption, global molybdenum demand is calculated to decrease by about 30% to 280 million pounds in 2009 from 2008. The demand could sustain 300 million pounds if steel makers’ output cut range is 20%. The demand in 2008 was estimated at 386 million pounds, slightly down from 2007. As to molybdenum supply, the firm forecasts the global supply would decrease by 10% to 343 million pounds in 2009 from 382 million pounds in 2008.

Taiyo Koko forecasts global vanadium demand at 154-160 million pounds of vanadium pentoxide in 2009, based on assumption of steel makers’ output cut by 20-30%. The demand in 2008 was estimated at 220 million pounds, slightly increasing from 2007. The firm forecasts global vanadium production would decrease by 12% to 211 million pounds in 2009 from 2008.