Commodities | Sep 20 2016
Sellers stepped up the pace last week, sending the spot uranium price down yet again.
By Greg Peel
The global nuclear industry plans to build 1000GW of new reactor capacity by 2050, said the World Nuclear Association’s Agneta Rising in her opening address to this year’s annual symposium in London last week. Prior to 2014, less than 5GW of capacity was typically added per year. But 5GW was added in 2014 and 10GW was added in 2015.
The plan now is to build 10GW per year over 2016-20, 25GW over 2021-25 and 33GW over 2026-50. This should be music to the ears of uranium producers but if last week’s uranium spot market trading is anything to go by, no one was listening.
Typically when market participants gather each year for the WNA symposium, activity in uranium markets quietens down. Not so this year. While utilities have become more active in the market of late, sellers have become increasingly desperate. Last week saw 900,000lbs U3O8 equivalent change hands in five transactions, industry consultant TradeTech reports, with half that volume traded in the final two days.
TradeTech’s weekly spot price indicator has fallen US50c to US$24.75/lb. To date, the spot price has fallen 4% over a month, 28% in 2016 and 63% since the Fukushima disaster in 2011.
While there are a number of contract requests yet to be filled in term uranium markets, no term transactions were concluded last week. TradeTech’s term price indicators remain unchanged on US$26.70/lb (mid) and US$38.00/lb (long).
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