• The market for molybdenum is growing exponentially
  • Pure play moly production is scarce and often ignored, a by-product of other commodities like copper
  • Taiton Resources’ Highway project in South Australia has a 2.5km-long molybdenum prospect

 

Often a small by-product of copper deposits, molybdenum, colloquially referred to as ‘moly’, is as much part of our DNA as it is an alloy in steel infrastructure – among many other applications.

Molybdenum (Mo) is everywhere, yet demand is going through the roof. It’s in our bodies, the girders that house us and a multitude of other infrastructure and tech applications. Even a lack of it in the soil can make the ground infertile.

If you open up a cabinet full of supplements you’ll likely find molybdenum as an ingredient in a few too, as it’s an essential mineral for our bodies, just like magnesium, iron and KFC.

Once eaten, it’s passively absorbed into your blood from your intestinal tract and carried to your liver, kidneys and other cool regions of your internals.

 

How molybdenum has become intrinsic to global infrastructure

It used to be confused with lead ores and was only until 1891 that molybdenum was discovered to be a pragmatic replacement for tungsten in steel alloy applications – due to the latter’s nearly two-fold atomic weight.

That substitution optimised material properties and enhanced the overall performance of steel alloys in diverse applications – integral to how ‘stainless steel’ is formed.

While the steel market is moly’s largest by far, it’s now widely accepted as a diverse technical material used in a range of applications; from superalloys, nickel-based alloys, hydrogen production, chemicals, lubricants and semi-conductors.

John Thompson from FinlayThompson Consulting has been in the chemicals and moly game for decades and reckons molybdenum is geared for exponential growth, however there are issues that need addressing.

“About 40% of the world’s molybdenum is produced in China and there’s scope to see that being diversified,” Thompson says.

“There’s also issues in South America (nationalisation) and other parts of the world that are leaving a gap in the market and while current demand is around 600Mlbs per annum and we expect that to increase by 18Mlbs per year for at least the next 10 years.”

Most molybdenum is found attached to copper sulphide deposits.

“The copper people, they focus on copper, and they’re looking for higher grade deposits right now. Paradoxically, this means moly as a by-product is generally lower in percentages,” Thompson says.

“That means there’s a real need to have primarily molybdenum-focused projects to offset that short-change and companies such as Taiton are looking to fill that gap.

“It never ceases to amaze me, the versatility of moly and its growing applications over the years.”

According to the International Molybdenum Association, production of Mo has stagnated, while demand, and prices are again on the rise after a short dip early last year due to supply gluts.

 

moly stocks china sulphide
Source: IMOA.

 

When Thompson was starting out in 2004, molybdenum was about $4/lb.

 

Flying under the radar

Yes, moly is found everywhere, though commercial-scale mines are rare, and that’s an issue. China is the world’s largest producer, yet there are mines dotted in countries such as the US, Peru, Chile and Russia.

Insert Taiton Resources (ASX:T88), which is looking to develop its Highway pure-play molybdenum deposit that also contains silver and other base metal credits across a massive 2,930km2 tenure – on the same stretch of magmatic-hydrothermal mineralisation as BHP’s (ASX:BHP) enormous Olympic Dam deposit.

Soil sampling in H2 last year identified a 2.5km strike molybdenum anomaly and maiden drilling finished off last September confirmed the presence of moly at Highway’s Merino prospect.

Follow-up drilling intersected >100ppm Mo mineralisation at an evident epithermal system where assays returned up to 92g/t silver and other pathfinder base metals.

The company is now looking towards the Garfield prospect to identify new targets ahead of a potential drill program.

 

drilling exploration (t88)
The Merino prospect drill holes. Pic supplied: T88.

 

 

While Taiton Resources is a Stockhead advertiser, it did not sponsor this article.