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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers

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To: que seria who wrote (33847)	2/25/2007 6:17:16 PM
From: hank2010	Read Replies (1) of 78421

I can't say I "know base metals markets" but here is my opinion. moly imparts "toughness" as well as anti-corrosion properties to steels. i.e. usually hardening of steel is accompanied by brittleness and cold weather failure. moly helps to overcome this. IMO moly prices are greatly influenced by energy prices. new pipelines, drill tubing etc. require moly as enviro regs are tightened and drills have to go deeper and into more hostile environments. Moly is also used as a catalyst in oil and gas refining and in conversion of coal to liquid fuels. Moly is a much smaller market than nickel or zinc. A large percentage comes as by-product from copper mines. There are lots of moly deposits proven up, the problem for the most part is that the lead time and capex requirements are so huge there is no immediate relief. On a %age basis moly has gone up more than the other three, and I think will keep that position. Nickel has generally been a game for the big boys. Large investments are required for smelters (sulphide ore bodies) or the roaster/leach or pressure-leach plants that are needed for the laterites. The biggest problem has been that all the new plants/projects have run into problems (cost over-runs, schedule over-runs, poor plant performance, or political delays. The small guys who are shipping to existing plants (mostly sulphide) are doing well. Zinc is the most common and has gone up the least. To put something into production is probably the cheapest and quickest of the 3 but nickel has a head start. I think recent good prices will lead to quick discoveries and production and keep mid term prices down compared to the other two. Do not overlook tungsten. The Chinese almost have a monopoly on tungsten production and are making noises that they will sell only products, (eg tungsten carbide drill bits, machine tools, filaments, armor and armor piercing munitions) not the metal compounds themselves. There are rumors that the U.S. defense dept. will stop using depleted uranium for armor piercing munitions and switch back to tungsten. tungsten has gone up by a factor of five already but if the Defense Dept switches it may be "Katie bar the door" This is all guess work on my part!

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