Commodities | Apr 28 2015
By Greg Peel
Prague hosted the annual World Nuclear Fuel Cycle conference last week, drawing attention away from uranium markets earlier in the week. A lack of buying interest saw sellers prepared to lower prices to conclude transactions and activity hotted up towards the end of the week, industry consultant TradeTech reports.
Six transactions totalling 600,000lbs of U3O8 equivalent changed hands but all the buying was conducted by intermediaries, with utilities remaining on the sidelines. TradeTech’s weekly spot price indicator has fallen US40c to US$38.50/lb.
At the conference, attendees learned that an eleventh hour attempt at an injunction preventing the restart of the Sendai one and two reactors in Japan was rejected by the local district court, removing another obstacle in the way of a planned start-up possibly in early June. Protesters are concerned about the safety of the reactors in the event of earthquake or the eruption of a nearby volcano, but the court was satisfied with rigorous new safety requirements.
In further news, the US and China have renewed a commercial nuclear cooperation agreement which allows for the transfer of material, reactors, components, information and technology between the two countries for nuclear research and power production. The deal provides “a comprehensive framework for peaceful nuclear cooperation with China,” said President Obama, “based on a mutual commitment to nuclear non-proliferation”.
And in the US the controversy over Department of Energy enriched uranium sales continues, with a Congressional committee now attempting to determine if DoE sales are in fact illegal and assessing what impact the sales have on the US uranium industry. Members of Congress argued that not only is the impact negative on US producers, the sales program fails to ensure the DoE maximises the value of its asset.
As ever, the expectation is for more utilities to enter the uranium term contract market shortly. Last week saw one utility concluding its evaluation of tenders for 2mlbs to be delivered over 2018-21, while another utility is expected to issue a request for proposal next week.
TradeTech’s term price indicators remain unchanged at US$43.50/lb (mid) and US$50.00/lb (long).
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