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Uranium Week: Spot Price Down -12% Since May

Weekly Reports | Sep 15 2020

The uranium price continues its gradual slide as the World Nuclear Association holds its Strategic e-Forum.

-Weekly spot prices fall just over -1%
-Resolution approaching on the Russian Suspension Agreement
-News from the World Nuclear Association Strategic (e-) Forum 2020

By Mark Woodruff

Market participants await news regarding ongoing negotiations between the US Department of Commerce and Russia. Negotiations concern the possibility of extending and limiting the amount of Russian separative work unit allowed into the US under the current Russian Suspension Agreement (RSA), which is set to expire on December 31. The DoC has set a deadline of October 5 for the parties to reach a resolution, and the parties are reported to be very close to announcing their agreement.

If the parties are unable to reach agreement soon, there will be a lack of clarity about the quantities of Russian-origin material that US utilities would be allowed to purchase in the future. Industry consultant TradeTech notes as the deadline approaches for 2021 delivery notices under existing agreements, an element of uncertainty would certainly be introduced into the enrichment market, and potentially lead to market turmoil.

World Nuclear Association Strategic e-Forum 2020

With covid-19 prohibiting travel for much of the industry, the World Nuclear Association (WNA) held a Strategic e-Forum 2020 last week, in place of its annual Symposium. According to TradeTech, there were wide-ranging discussions on how nuclear energy can address some of the most pressing issues in the world today. Other topics included how to attract investment for future growth and promote the socio-economic and environmental benefits of nuclear energy.

At the forum, Polish climate minister Michal Kurtyka discussed his plan to construct six new nuclear power units by 2040, as the country transitions to a clean energy economy. With a growing economy and an energy policy that calls for nuclear power to constitute 14% of its energy mix by 2040, Poland has launched a US$40 billion initiative to build new nuclear power capacity beginning in the 2030’s. Coal currently accounts for nearly 74% of Poland’s electricity generation, notes TradeTech. Poland’s energy policy for 2040 aims to reduce coal’s contribution to the electricity mix to between 11% and 28% by 2040.

Commenting on the environmental benefits of reliable, carbon-free nuclear energy in the US, GE Hitachi President and CEO Jay Wileman said, “Thanks to the nuclear energy we have here, we avoided over 476 million metric tonnes of carbon just last year. That’s the equivalent to taking 100 million cars off the road. So think about that across the world with the more than 450 units that we have as an existing installed base, and the work that we have to do to continue to grow that with new nuclear.”

Uranium Pricing

TradeTech’s Weekly Spot Price Indicator fell to US$30.15/lb U3O8 last week. This was a decrease of -US$0.35 from last week’s value.

Total transactional volume for the week totaled approximately 750,000lbs U3O8, with utilities, traders, and producers all participating as buyers.

The weekly spot price currently sits 21% above its January 3 value of $US24.85/lb but has declined by -US$4.10/lb or -12% since reaching a year high of US$34.25/lb in May. The average weekly uranium spot price for 2020 is US$29.68/lb, US$3.82/lb above the 2019 average.

TradeTech's term price indicators remain at US$34.50/lb (mid) and US$37.00/lb (long).

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