Parag Project Drills High-Grade Molybdenum as Prices Surge Fivefold

China’s Export Controls Reshape Molybdenum Market

In a significant development for the global molybdenum market, China, accounting for nearly half of the world’s molybdenum production, has imposed export controls on certain molybdenum products. This move, widely viewed as a strategic response to US tariffs, tightens supply from the world’s dominant producer and sends ripples through the metals and mining sectors.

Molybdenum, a critical alloying element used to strengthen steel and enhance corrosion resistance, has seen its price surge to approximately US$20.75 per pound, nearly five times that of copper. The metal’s strategic importance is underscored by its applications in infrastructure, energy, and defense industries.

Parag Project Emerges as a Strategic Alternative

EV Resources Limited (ASX: EVR) holds a 70% stake in the Parag copper-molybdenum porphyry project in Peru, which is now poised to fill the supply gap created by China’s export restrictions. The project has delivered consistently high-grade molybdenum as a valuable by-product of copper mining, with recent drilling campaigns confirming extensive mineralisation near surface.

Notably, the 2024 drilling program yielded impressive intersections such as 476 metres grading 0.31% copper and 0.14% molybdenum, including higher-grade zones with up to 0.43% molybdenum. These grades compare favourably with many primary molybdenum mines globally, highlighting Parag’s potential as a cost-effective and reliable source.

Strategic Positioning for the Americas

With the USA producing only 12% of global molybdenum and reliant on imports, EV Resources is attracting interest from molybdenum roasters and processors across the Americas. The company’s proximity to the recently opened Chancay bulk port in Peru enhances its logistical advantage, facilitating efficient export routes to North and Latin American markets.

EV Resources’ Managing Director Hugh Callaghan emphasised the strategic timing: "As global molybdenum supply tightens due to ageing mines and geopolitical shifts, Parag’s high-grade by-product molybdenum offers compelling economic support to our copper project and positions us well to meet growing demand."

Next Steps and Market Outlook

EV Resources is currently evaluating optimal funding arrangements to advance further drilling at Parag, aiming to delineate resources that could underpin near-term development. The company continues discussions with potential off-take partners in the USA and Americas, signalling strong market interest.

While the project benefits from favourable community relations, abundant water, and renewable energy sources nearby, the path to production will depend on continued exploration success, commodity price stability, and securing financing. Nonetheless, Parag’s emerging profile as a strategic molybdenum supplier aligns with broader market trends seeking to diversify supply chains away from China.