Commodities | Feb 12 2007
By Rudi Filapek-Vandyck
The week until February 9 was again characterised by a disappointing market update on Cameco’s troubled Cigar Lake project as well as by the absence of a concluded deal between willing buyers and unwilling sellers in the uranium spot market.
As a result, industry consultant TradeTech’s spot uranium price indicator has again remained unchanged at US$75 per pound.
TradeTech, which has been overseeing transactions in the industry since 1968, believes trading volumes in the first weeks of 2007 are the lowest in any given calendar year since 1997, signaling a wide gap between price hopes and expectations for buyers and sellers in the market.
It probably won’t surprise anyone TradeTech forecasts the spot price to spike further in the next few weeks, especially now that Cameco has indicated –hesitantly- that remediation of its flooded Cigar Lake project may exceed the originally flagged twelve month period.
The company is yet to update in more detail on the project at the end of March. However, during this week’s conference call with securities analysts and media management conceded it had asked clients for a precautionary delay of supply from the mine for up to seven years.
On January 29th NuclearFuel, the newsletter of energy specialist Platts, reported it was likely that any uranium spot market deals done over the next few weeks would be concluded within a range of US$75 to US$81/lb. The newsletter said this forecast was based on discussions with market analysts.
TradeTech has not put a concrete figure to its forecast of higher spot prices in the short term.