Commodities | Mar 15 2016
By Greg Peel
Last week Japan’s Otsu District Court ruled against the restart of Kansai Electric’s Takahama units 3 and 4, creating renewed uncertainty around the timing of reactor restarts in the country. Prime Minister Abe’s frustration was clear:
“Our resource-poor country cannot do without nuclear power to secure the stability of energy supply while considering what makes economic sense and the issue of climate change.”
To date, only two of Japan’s reactors have been restarted.
Since the Japanese tsunami hit five years ago last week, the spot uranium price has since fallen 58%. Hopes for renewed buying interest from utilities in 2016 is looking increasing misplaced. A total of 700,000lbs U3O8 equivalanet changed hands in five transactions last week, industry consultant TradeTech reports, at ever decreasing prices as the week progressed.
TradeTech’s weekly spot price indicator has fallen US$2.35 to US$28.75/lb – the lowest level since August 2014. The spot uranium price has fallen 16% in 2016 to date alone. Low prices did spark up some utility buying interest later in the week, but sellers were not prepared to capitulate even further. Transaction volumes in 2016 to date are 50% below those of the same period last year.
Two transactions were reported in the uranium term markets last week – one small, and one for 4mlbs U3O8 to be delivered over 2020-29. Tenders for the supply of in excess of 20mlbs over three different delivery contracts are yet to be settled, as has been the ongoing case for weeks now.
TradeTech’s term price indicators remain unchanged at US$33.90/lb (mid) and US$44.00/lb (long).
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