Corporate investors, including China Life (2628.HK: Quote, Profile , Research), Citigroup (C.N: Quote, Profile , Research), Citic Pacific (0267.HK: Quote, Profile , Research), Cheung Kong (0001.HK: Quote, Profile , Research), Hong Kong tycoon Cheng Yu Tung, the Li Ka-shing Foundation, Bank of East Asia (0023.HK: Quote, Profile , Research) Chairman David Li, tycoon Lee Shau Kee and the Government of Singapore Investment Corp., bought a combined 3.9 percent of the firm through the offering.
SURGING DEMAND
Molybdenum prices jumped to a 17-month high in March as China raised export barriers for firms that export minor metals to crack down on polluting, resource-intensive industries.
Ferro molybdenum prices rose to US$79 a kilogram in March, the highest since October 2005, due to a sudden increase in demand from steel production that was not matched by roasting capacity. Prices fell back to US$59.5 in January.
China accounted for 29 percent of global molybdenum output in 2004, but only 20 percent in 2005 as Beijing began closing small and polluting mines. Beijing, which recently imposed a 10 percent export duty on molybdenum, is expected to take further steps to discourage exports due to strong domestic demand.
China Molybdenum has six processing plants with annual ore processing capacity of 9.9 million tonnes. The firm plans to lift its roasting and smelting capacity to 20 kilotonnes per year and 15 kilotonnes per year, respectively, in 2008, from 18 kilotonnes and 11 kilotonnes, respectively.
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