Commodities | Mar 29 2016
By Greg Peel
After rebounding somewhat the week before, prices in the spot uranium market drifted down again early last week on a lack of immediate buying interest. The drift was nevertheless arrested when new interest entered the term market.
Interest continues to build in the term market, albeit buyers seeking significant volumes are clearly in no rush to settle contracts. There have been contracts awaiting settlement for over 20mlbs of U3O8 equivalent for some months now and prospective buyers continue to enter the market for mid and long term delivery, for volumes ranging from 100,000lbs to 2mlbs.
The spot market is seeing little end-user interest so traders and intermediaries continue to hold out for contract settlements in order to assess price direction.
Five transactions totalling 600,000lbs U3O8 equivalent were conducted in the spot market last week, industry consultant TradeTech reports. TradeTech’s weekly spot price indicator has fallen US20c to US$29.40/lb.
TradeTech’s term price indicators remain unchanged at US$33.90/lb (mid) and US$44.00/lb (long).
Some uncertainty was generated in the uranium market last week when the president of the world’s largest uranium producing nation – Kazakhstan – suggested his government may be about to take some drastic action against foreign operators in the country. Mr Nazarbayev warned asset may be reclaimed from mining companies which are not meeting their obligations with regard mine development.
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