20 years of restarting life

Chapter 3882 The Second Line of Defense

"If the trading company eventually sells off this inventory for 1,000 or 2,000 yuan and makes a profit of 100 or 200 million yuan, although some people will be envious, they won't be too envious, because you are also gambling, it's just that you won this time."

Wen Ye frowned and said, "If you hadn't said you'd ship at 2000, but instead shipped at an average price of 1800, you could have brought the trading company a profit of 9.6 million. Although it's legally sound, there will definitely be plenty of complaints and jealousy. At the very least, people will say that the molybdenum company persisted for two years, and you ended up reaping the benefits."

"What if we need to do another layer of isolation?"

"?"

Wen Ye didn't understand the meaning of Zhao Chang'an's words for a moment.

Zhao Chang'an said, "I will register another foreign company, and when the price reaches 1000, I will resell all these molybdenum concentrates and ferromolybdenum ore, betting that the price will rise further. However, this company has no affiliation with the domestic company, it belongs entirely to another company. If the price falls back below 1000, I will accept the loss. If it keeps rising, even to three or five thousand, ten or twenty thousand, it will have nothing to do with this company."

Wen Ye finally understood the logic in Zhao Chang'an's words and couldn't help but laugh.

Although Luanchuan Molybdenum received 6 million yuan in investment from OneNanometer after the joint venture, the company's total debt has now exceeded 10 billion yuan.

It's like a bowstring that's been stretched to its maximum tension; if some of the tension isn't released quickly, the bowstring could snap at any moment.

This is why Gu Dacong and his team were so eager to get one nanometer into the market. Not only was the transfer price low, but there were also many preferential policies.

What one can imagine now is how many people, though still poor, had their first good year in five or six years after OneNan decided to take control of the molybdenum company.

Many individuals and businesses are eagerly awaiting the joint venture's approval, only to then rush to the new company with IOUs to collect their debts.

OneNano currently owes banks over 7 billion yuan in China alone, and this time it needs to borrow another 600 million yuan, bringing the total to over 8 billion yuan including principal and interest.

It can be said that the company's debt is already very high. If it weren't for BlackBerry's soaring stock price and Zhao Chang'an's net assets of no less than 20 billion, these banks would have already been unable to sit still and came to demand additional collateral or guarantees.

In order to maintain its image, after investing 6 million yuan in the molybdenum company, OneNano Holdings could not default on its debts or continue to delay payment when facing creditors.

At most, we can prioritize and settle half of the outstanding debts first, then pay back two or three months' wages to the workers, and settle the overdue social security payments, especially the hospital bills for employees and retired workers. That will spend almost all of the 6 million yuan.

So what will the molybdenum company do next? Will it start production again, or simply stop production and wait for the industry to recover?

The answer is definitely to start mining, primary processing, and smelting at full capacity. After all, Zhao Chang'an is betting that molybdenum prices will soon surge, and time waits for no one.

So where will the money for production come from, and where will these initial processed products be stockpiled? Zhao Chang'an's plan is definitely a very favorable betting agreement for the company.

However, there is a problem here. If the price of molybdenum concentrate not only recovers in the next year, but also rises to a high level, then will the joint venture Luanchuan Molybdenum make so much money all at once? Will there be people who are envious and say that these mines were dug up and piled up in warehouses before the joint venture, and demand a recalculation and allocation?
Never doubt the evil and selfishness of human nature.

Zhao Chang'an first established a foreign trade mineral products import and export company, which was equivalent to locking the price of molybdenum concentrate within 1000 yuan/ton. As soon as it exceeded that price, he immediately transferred ownership to a second foreign trade company, thus perfectly completing the separation and isolation.

As for the second foreign trade company, with so much molybdenum concentrate in its hands, if the price continues to rise, it can make money per nanometer. However, if the price suddenly plummets, even below 500 yuan per ton, then it will lose money.

Whether to make money or lose money is a business choice for OneNan Holdings, and it has absolutely nothing to do with the molybdenum company.

The cost of molybdenum concentrate from Luanchuan Molybdenum is approximately 700-800 yuan/ton. Selling at 1000 yuan/ton, with a 20% net profit margin, yields approximately 2.4 million yuan (excluding variable expenses). While still considerable, this wouldn't make some people green with envy.

What do you think the highest price will be?

Wen Ye asked Zhao Chang'an.

"No less than 4000."

Zhao Chang'an didn't recall the exact highest price, but he was certain it wouldn't be lower than the price he mentioned.

Wen Ye gasped, meaning the price would increase eightfold from its current level.

Even at a price of 1000, one nanometer can still capture a price difference of 3000, which is approximately $4.3 million, or nearly 36 billion RMB.

The entire molybdenum group only made a net profit of about 2.4 million yuan from this batch of goods. It's no wonder that Zhao Chang'an was afraid that someone would be jealous and cause trouble because of the huge price difference between the two.

As for emptying the mine silos, the molybdenum concentrate and ferromolybdenum ore that were restocked after the joint venture were all products of the joint venture. Profits were distributed according to the shareholding ratio, so no one could say anything wrong or find fault with them.

Although Zhao Chang'an didn't expect to capture all the profits from the highest price and cash out at the peak, the upward trend of molybdenum metal in his previous life this autumn wasn't exactly a perfect climbing path either.

During this period, prices continued to rise and fall sharply until the beginning of 05, when they surged all the way up to a peak of 6250 yuan/ton in four months.

In other words, if Zhao Chang'an had been more conservative in acquiring this batch of goods and had gradually sold them off after the price reached 5000, his total profit would have exceeded 50 billion RMB.

It's worth noting that Luoyi's GDP last year was only 465.7 billion yuan, with budgeted revenue of 24.22 billion yuan and expenditure of 35.76 billion yuan.

Even with economic development and a certain increase in the local economy over the next two to three years, a profit of nearly 50 billion is still incredibly astonishing.

This doesn't even take into account the profits that Zhao Chang'an will generate after acquiring Luanchuan Molybdenum, which he will definitely require the company to resume full-scale production.

Will Zhao Chang'an's butterfly effect alter the history of price fluctuations in the molybdenum industry?

In his previous life, the molybdenum group also stockpiled so much molybdenum concentrate, and when prices recovered in the future, they would definitely increase production as much as possible.

The only variable is the completion of the joint venture integration. Until prices recover in the future, Zhao Chang'an will require the company to operate at full capacity.

However, this slight increase is less than 4% of the annual output of 13 tons of molybdenum metal, and its impact is negligible.

In fact, Zhao Chang'an was being overly cautious. Global capital speculators have a much greater capacity to design for and withstand uncertainties than he thought.

In his previous life, after a sharp rise in global molybdenum prices, North America restarted the Claymax molybdenum mine in early 2004, and by September it had reached a production capacity of 2,000 tons of molybdenum per month.

However, Chile, China, and the United States, which were major molybdenum producers at the time, experienced an incredible decline in total output.

The total global output for the year was only 11.64 tons, a decrease of nearly 03 tons from 14.7 tons in 3.