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Uranium Week: Positive Start

Weekly Reports | Feb 05 2019

The sustained upward trend in the uranium spot price that began last April has continued into 2019.

-Record volumes continue into 2019
-Price uptrend sustained
-Utility interest growing

By Greg Peel

The sustained upward trend in the uranium spot price that began in April 2018 has continued into the new year, notes industry consultant TradeTech, as recent market trends show little sign of abating.

Delays to existing and emerging production, as well as continued interest from the investment community and consistent producer buying, have resulted in regular upward price pressure — since April 2018, TradeTech's weekly spot price indicator has increased nearly 38%.

The consultant believes increased monthly transaction volumes have played a part in the sustained uptrend. Increased liquidity in the market has reduced the barriers to entry and exit. Records were broken in 2018 in terms of both number of transactions and pounds traded.

January 2019 posted the second highest number of transactions and the fourth highest January on record since 1996 in terms of pounds. The final week of January saw eight transactions concluded totalling 1mlbs U3O8 equivalent.

TradeTech’s weekly spot price indicator nevertheless fell -US10c to US$28.90/lb in the last week of the month but was up US$1.90 at month-end from end-December. While producers, intermediaries and financial investors continue to feature on the buy-side, TradeTech reports a “definite uptick” in utility buying.

Term Trends

Two transactions were concluded in January in the mid-term market. For a period last year TradeTech’s term price indicators remained steady at US$30.00/lb (mid) and US$31.00/lb (long). At end-December, the consultant moved those indicators in separate directions to US$29.00/lb (mid) and US$32.00/lb (long).

At end-January, TradeTech has left the long-term price at US$32.00/lb but moved the mid-term price back up to US$30.00/lb.

A number of utilities have term delivery contracts out for tender. One utility is seeking 6mlbs U3O8 equivalent for delivery over 2020-25, another is seeking 2.25mlbs over the same period, and yet another is after 10.8mlbs over 2019-25.

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