Teck Resources' Quebrada Blanca II project in northern Chile’s Tarapacá is on track to start operations in March 2023, with a guidance 4.5-6.8Mlb molybdenum for this year.

The molybdenum market has been headlining with record price levels. The noble alloy is used largely in alloy and stainless steels and demand has been slow to pick up pace from the weak 2022 economic environment. However, disruptions to supply in Chile and Peru has put pressure on the supply chain and material is currently hard to come by as the market fell into deficit in 2022.

Production remains tight in Q1 2023. With demand from stainless steel expected to recover more strongly over Q2 and the second half of the year, available supply will likely be strained further. The industry is looking to the copper mines in South America as the main short-term solution to bring the market back into balance. According to Project Blue data, 2021 output levels in Chile and Peru can secure sufficient supply to quench the deficit. The production guidance from Teck Resources’ new project will help move the market in the right direction, though additional supply ramp ups and restarts will be required to tip the market back into balance for 2023.