Sinolink: "Energy + Conflict" as the Core Pricing Factor for Molybdenum, Industry Demand Remains Strong

Sinolink published a research report stating that from 2004 to 2008, the expansion of investment in the energy industry combined with supply bottlenecks drove a rapid rise in molybdenum prices. From 2009 to 2015, supply expansion and slowing demand led to a long-term slump in molybdenum prices. From 2016 to 2020, traditional demand recovery drove price corrections, while external shocks put additional pressure on the market. Since 2021, with the expansion of energy chemical and advanced manufacturing demand and limited supply increments, the price of molybdenum has continued to rise. In the first half of 2026, China's net imports of molybdenum reached 18,900 tons, an increase of 124.0% year-on-year, along with a stable yet declining domestic inventory, reflecting sustained demand for molybdenum. Sinolink's main viewpoints are as follows: Molybdenum: A Key Element in High-End Manufacturing and Energy Chemicals Molybdenum possesses a high melting point, high-temperature strength, high thermal conductivity, and a low thermal expansion coefficient, along with excellent alloying properties, making molybdenum and its alloys suitable for specialized fields such as electronic devices, heat treatment equipment, and metal processing. New Generation Storage Interconnect Materials, Driven by AIs Expansion of High-End Demand As 3D NAND technology advances to over 300 layers, tungsten word lines face constraints such as rising resistance and RC delays. Molybdenum, at the nanoscale, has a lower effective resistivity and potential for integration without a barrier layer and high aspect ratio structure filling. Samsung Electronics has introduced molybdenum metallization processes in its ninth generation of 3D NAND, and SK Hynix also plans to switch some word line materials from tungsten to molybdenum in its next generation products. With the expansion of storage demand driven by AI, the application of molybdenum in 3D NAND is expected to open up new opportunities for advanced processes and drive growth in the demand for high-purity molybdenum raw materials and molybdenum-containing precursors. Demand: High-End Manufacturing Flourishing, Energy Chemicals Rising According to IMOA, global molybdenum usage is expected to increase by 3.6% year-on-year to 304,700 tons in 2025, with Chinas usage also up by 10.8% year-on-year to 153,200 tons, accounting for 50.3% of global demand; the CAGR for global and Chinese molybdenum usage from 2020 to 2025 is projected to be 4.5% and 7.6%, respectively. According to ferroalloy.com, domestic steel tender volume is expected to rise from 120,800 tons in 2023 to 157,000 tons in 2025, with 82,700 tons tendered in the first half of 2026, a year-on-year increase of 8.4%. Energy Chemicals: The oil and gas and thermal power sectors remain robust, with more upward potential. In early March 2026, Brent crude oil prices broke above $80 per barrel, and accounting for the lag in capital expenditure, demand for related equipment is expected to significantly rebound from the third quarter of 2026, supporting molybdenum demand in the energy chemicals sector. High-End Manufacturing: Shipbuilding leads the way, with wind power and construction machinery showing a positive resonance. From January to June 2026, the global shipbuilding completion volume reached 60.77 million deadweight tons, an increase of 30.5% year-on-year. The rebound in high-end manufacturing is expected to drive molybdenum demand for high-strength steel, special steel, and large alloy components. Strategic Demand: Steady growth in defense budgets, sustained high investment in high-end equipment, and stable growth in molybdenum demand for high-performance alloys. Supply: Declining Overseas, Slow Domestic Increase Global molybdenum production is projected to be around 305,100 tons in 2025, an increase of 5.1% year-on-year; of this, China, South America, and North America will account for 44.9%, 26.1%, and 19.9%, respectively, with the by-product nature of molybdenum restricting short-term supply elasticity. Overseas major mining companies are guiding lower production for 2026, with expected molybdenum production overseas for 2026-2028 at 159,400 tons, 156,600 tons, and 156,500 tons, down 2.2%, 1.8%, and 0.0% year-on-year, respectively; domestic increases are primarily from projects like the second phase of Jilong Copper Mine and Dasyu Molybdenum Mine, with supply increments expected to be limited. Supply and Demand Balance: Molybdenum Supply-Demand Gap Expected to Continue Widening The bank projects that global molybdenum demand will increase by 4.6%, 3.6%, and 3.3% year-on-year for 2026-2028, while global supply will increase by 0.5%, decrease by 0.2%, and increase by 2.1%, respectively, corresponding to a widening supply-demand gap of 22,000 tons, 34,000 tons, and 39,000 tons for those years. This tightening supply-demand pattern is expected to support the price center of molybdenum. Related Targets: Jinduicheng Molybdenum (leading in molybdenum resources with deep investments in molybdenum powder business); Guocheng Mining (advancing acquisition of remaining stake in Dasyu Molybdenum Mine, expected to significantly enhance profits); Luoyang Shenglong Mining Group (prominent molybdenum resource endowment, simultaneous expansion of mining and development of high-performance molybdenum materials). Risk Alerts Molybdenum price volatility risk; downstream demand falling short of expectations; project commissioning not meeting expectations; safety production and environmental risk.