Weekly Reports | Apr 30 2019
President Trump may not need all of the 90 days he has to make a decision on section 232 but there is no guarantee of a timeframe.
-Uncertainty still reigns
-Japan to close reactors
-India to build new ones
By Greg Peel
Uranium market watchers are undoubtedly tired of section 232 but unfortunately uncertainty still hangs like a spectre over the market. The bottom line, after the US Department of Commerce delivered its recommendations on April 14 after using most of the allotted 270 days to get there, is that President Trump has up to 90 days to make a decision.
The good news is the similar 232 decisions with regard steel and aluminium, which led to tariffs, took the president only 46 and 58 days respectively to decide upon. The bad news is an auto import decision is still being awaited after 68 days, and an investigation into titanium is now also underway. So things are starting to back up.
Activity in the uranium spot market was off to a slow start last week following Easter, industry consultant TradeTech reports, but by midweek sellers had begun to lower prices in order to attract buyers. The spot price had remained unchanged the week before. Lower prices did lead to an increase in transaction volume.
TradeTech’s weekly spot price indicator ended the week down -US65c at US$25.20/lb.
There were no transactions reported in term markets. TradeTech’s term price indicators remain at US$28.00/lb (mid) and US$32.00/lb (long).
Comings & Goings
It’s been eight years since the Fukushima disaster and the pace of Japanese reactor restarts remains glacial. Not only do legacy reactors need to be upgraded to strict new safety standards in reference to the earthquake/tsunami that sparked the disaster, but they must also meet the regulator’s anti-terrorism upgrade requirements.
The Nuclear Regulation Authority has now indicated plants that do not meet the deadline for anti-terrorist upgrades will be issued with closure notices. Three Japanese utilities have admitted upgrades to some ten plants between them will not be completed on schedule.
Meanwhile India is ramping up its own nuclear power ambitions, with plans announced to build an additional 12 plants in an effort to ensure a more secure power supply. The first stage of the country’s nuclear program has now reached maturity with 18 operating plants.
To that end, India’s leading supplier of uranium, Kazakhstan, is considering increasing export levels to India from the 13mlbs U3O8 contracted for 2015-19 to 19.5mlbs or more for the next five years. Kazakhstan is the world’s swing producer and is currently limiting its own production in order to support prices.
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