SOURCE: AXcess News

June 12, 2008 14:24 ET

AXcess News: Rising Steel Demand Boosts Molybdenum, Iron Ore Prices

HOUSTON, TX--(Marketwire - June 12, 2008) - Rising global demand for steel is boosting iron ore, molybdenum prices that in turn are producing a renaissance in mineral exploration that led Consolidated Pacific Bay Minerals Ltd. (TSX-V: CBP) (PINKSHEETS: CPBMF) to acquire a property explored by Andrew Robertson, P.Eng., a co-discoverer of Endako Mines Ltd.

Con Pacific Bay President, David Brett, told AXcess News in a telephone interview Wednesday that at the time Robertson explored the Haskins-Reed Property in Northern British Columbia in the early 70s that the price of molybdenum was "too low to make the mine economically feasible," but at today's prices, which according to Base Metals is $33.50 per pound on the London Metals Exchange, it is. Brett noted that in a June 10, 2008 press release on the acquisition the 1.9 million tons of ore would be worth $235.5 million and that was only based on one area which the father of molybdenum discoveries, Robertson, had exported.

CBP's Brett said a geological report was being prepared for release and that Con. Pacific Bay hoped to begin its own exploration and drilling efforts yet this year.

Fueling the surge in interest in base metals exploration is the growing demand for steel.

According to the latest steel production report from the International Iron & Steel Institute, world crude steel production for the first four months of this year totaled 457.29 million metric tons, up 5.7% compared with the Jan-April 2007 period... China produced 169.8 million metric tons of crude steel, an increase of 9.1% compared to the same period in 2007...U.S. steel production, meanwhile, was placed at 33.77 million metric tons, up 6.5%.

Iron ore prices, like molybdenum, are also at record levels. Rio Tinto, the world's second-largest iron ore producer, has raised its rates more than 85% for shipments to China. Japanese and South Korean steel mills already saw 65% increases in iron ore prices in February. While in South Korea, companies are venturing outside their realm in taking positions in Canadian junior mining exploration companies to develop assured sources of molybdenum, which is used in hardening steel during the production process.

Velocity Minerals Ltd., which began trading on the Toronto Stock Exchange this year, announced the appointment of Mr. Edward (Kwon Youb) Yoon to its board recently. Velocity noted that Yoon has extensive experience in molybdenum import and export.

"Korea is very much in need of commodities such as molybdenum and most Korean import companies that source molybdenum from China are having an increasingly difficult time doing so," said Yoon.

Velocity's molybdenum property is located on Mt. Haskin, where Con. Pacific Bay Minerals' Haskin-Reed property is located.

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