Uranium Week: Restart Approaching

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By Greg Peel

Six transactions totalling 900,000lbs of U3O8 equivalent were traded in the uranium spot market last week, industry consultant TradeTech reports. Sellers were not keen to lower prices to meet buying interest earlier in the week thus when two utilities entered the market looking for a total of over 300,000lbs, buyers were encouraged into paying up.

TradeTech’s weekly spot uranium price indicator nevertheless remains unchanged at US$36.50/lb. Near term spot market interest remains generally weak, the consultant suggests, given a preference for delivery from 2016 and beyond.

Three transactions totalling 1.2mlbs of U3O8 equivalent were concluded in the mid-term market last week, and new demand emerged from a utility seeking 100,000lbs per year over 2018-19 and 300,000lbs per year over 2020-25. Another utility is seeking a total of 9mlbs over 2017-26 and further utility interest is also emerging.

TradeTech’s term price indicators remain unchanged at US$39.00/lb (mid) and US$46.00/lb (long).

Japanese utilities held shareholder meetings last week and a number of antinuclear proposals were pushed, but officials expressed their eagerness to restart nuclear power plants as soon as possible. Kyushu Electric’s Sendai units 1 and 2 should begin the restart process in the next couple of weeks.

There are currently 43 operable reactors in Japan potentially able to restart, TradeTech notes, of which 24 are now in the process of seeking restart approval.

While Japanese utilities might be keen to fire up once more, German utilities are disgruntled that the opposite is true in their country. Germany’s Grafenheinfeld reactor shut down last week as the process of phasing out nuclear energy by 2022 proceeds. It’s a long timeframe, but already Germany’s electricity supply is feeling the strain, as the construction of new power lines fails to keep pace with the shift in supply sources.

Australia’s Paladin Energy ((PDN)) made history this week by being approved for majority ownership of the proposed Michelin mine in Canada. Canadian law stipulates Canadian uranium mines must be majority owned by Canadian companies or investors but the law does allow leeway when no Canadian partner puts its hand up.

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