Commodities | Mar 17 2015
By Greg Peel
In a quiet week in the spot uranium market, volume dropped to five transactions totalling 500,000lbs of U3O8 equivalent last week from 2.3mlbs the week before. Industry consultant TradeTech’s spot price indicator has risen by US10c to US$39.10/lb.
Four years ago last week the spot price was trading at US$67.50/lb before the Japanese earthquake struck. Three and a half years of price declines followed before it appeared the price may have bottomed out, reigniting some hope for uranium producers. But it remains some 42% below the pre-Fukushima level.
Utilities have spent most of the interim period drawing down on existing inventories. The Russian HEU program came to a close during the period but did not make as much of an impact on supply as had previously been anticipated. Many nations, particularly in Europe, have reassessed their nuclear energy aspirations in the wake of the Fukushima disaster while on the other hand, China has pressed inexorably forward with its goals to include nuclear as a significant part of its alternative energy mix.
Japan shut down 48 reactors in 2011. To date only two have been cleared for restart by both the safety regulator and by the local populace, and are expected to be restarted around June. Two more have been cleared by the regulator but remain to be approved by local residents. As to how many reactors Japan might ultimately restart at this point is unclear, but the excessive cost of replacement fossil fuel-fired electricity has hampered the country’s economic recovery efforts and attempts to reduce carbon emissions.
The nuclear energy landscape is a very different one today than it was in 2011. Much remains uncertain.
TradeTech’s term uranium prices remained unchanged last week at US$42.50/lb (mid) and US$50.00/lb (long).
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