By Andrew Nelson

For the first time in six weeks the price of uranium showed some backbone, holding firm at US$42.50/lb last week, according to industry consultant TradeTech's U3O8 Weekly Spot Price Indicator. And it wasn't a quiet week either, with nine transactions totalling just under 1 million pounds U3O8 equivalent reported.

One of the main reasons for this flurry of activity was the recent decline in the spot price, which dropped from US$47.50 at the beginning of August to US$42.50 by mid-September. A resultant spate of bargain hunting saw several parties enter the buyers market last week, while TradeTech reports there were a number of additional transactions that were still "under consideration" as the week ended.

The reason bargain hunting still drives current market dynamics is because a cloud is hovering over sellers who are eagerly awaiting clarity about the US Department of Energy's (DOE) plans to possibly release as much as 1,200 tonnes of UF6 by October 15. This doubt has seen an increasing number of spot sellers deciding to take pre-emptive action and sell existing inventories before this new material finds its way into the market.

This was borne out by market action early in the week, when the spot price dipped as low as $42.00 per pound. TradeTech reports there were several transactions concluded at this price level. But last week''s early action seemed to soak up much of the aggressively priced supply that was for sale by those looking to cash out of the game before the release of material by the DOE.

After the initial rush, prices began to stabilise and then rise over the course of last week, with TradeTech reporting the deals concluded towards the end of the week were at or very near the current spot price.

Otherwise, the long-term market was quiet last week, with TradeTech reporting no new demand and no transactions, which saw its Long-Term Price Indicator stay firmly rooted at US$65.00.

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