Commodities | Feb 10 2015
By Greg Peel
Last week saw 1.6mlbs of U3O8 equivalent change hands in eight transactions compared to 1.1mlbs the week before and 600,000lbs in the same week last year. Industry consultant TradeTech reports the bulk of buyers are non-end users of uranium, such as intermediaries and speculators, but several utilities have moved into the market in an attempt to quietly source material.
Pricing is being determined by delivery date, with “spot” deliveries as late as the December quarter requiring higher prices than more immediate transactions. Spot prices climbed over the course of the week as sellers continued to exploit newfound demand. TradeTech’s spot price indicator closed the week at US$38.15/lb, up US90c from the week before.
Two transactions were reported in the term market last week totalling 400,000lbs. TradeTech has lifted its mid-term price indicator by US$2.25 to US$41.25/lb while leaving its long-term indicator unchanged at US$50.00/lb.
Media reports out last week suggested the Japanese government is hoping to restart the first of the country’s idled reactors – the Sendai Units 1 and 2 – by around June. By then Japan’s regulator is expected to have completed the final inspections ahead of the prime minister granting final restart approval. The local mayor and governor granted approval late last year.
No official announcement has been made regarding a restart date but reports note a June restart would follow the April general election, at which Shinzo Abe can make his case. While there remains significant opposition in Japan to nuclear energy, the country’s economy was crippled last year by the cost of importing fossil fuels to replace the 30% of Japan’s electricity previously generated by nuclear reactors. Cleary fossil fuel costs are now a lot cheaper, but this does not alter the fact the Abe government would like to see at least a particle return to previous nuclear capacity.
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