Weekly Reports | Aug 21 2018
Global nuclear power generation marked its fifth successive increase in 2017, as last week spot market activity surged on price variance across the globe.
-Nuclear power increasing
-Kazatomprom to go public
-Arbitrage activity boosts spot volumes
By Greg Peel
Global nuclear power generation increased in 2017 for the fifth successive year to provide more than 10% of global electricity demand, according to the World Nuclear Association’s World Nuclear Performance Report released last week.
For new reactor projects, the average median construction time was 58 months, down from 74 months in the previous year and less than half of the time taken in the period 1996-2000. But only four new reactors began supplying power in 2017, down from ten in each of the previous two years.
The news comes as China reached a milestone with the world’s first AP1000 plant reaching power generation last week. Testing will continue before the reactor goes into commercial service towards the end of the year. Another two AP1000s are expected to fire up by the end of 2018 and another in 2019.
Despatches from Kazakhstan
The Kazak government has reported a -6% decrease in uranium production in the first half of 2018 compared to the first half 2017. Kazakhstan – the global swing producer – has vowed to decrease production in 2018 to support prices but a similar promise made in 2017 fell short of target.
The government has promised a -20% reduction over three years.
As to what the policies of state-owned producer Kazatomprom will be in the future will be a matter of public consideration. Kazakhstan’s sovereign wealth fund confirmed last week an initial public offering for Kazatomprom will be launched before year’s end.
Busy Week
In the week prior, industry consultant TradeTech’s weekly spot price indicator sat at US$26.10/lb, some 30% higher year on year. By the middle of last week, 800,000lbs U3O8 equivalent had changed hands at or near US$26.25/lb.
This brought out the sellers, and by week’s end TradeTech's indicator had fallen to US$26.00/lb, down US10c on the week. A further 1.2mlbs changed hands to bring the week’s total volume to an impressive 2mlbs. It was the first weekly price decline in two months.
TradeTech offers its price as an indicator but the consultant notes prices globally are currently fluctuating depending on delivery location. Delivery points in the US, Canada and Europe are seeing variance in prices, to the extent last week saw some traders arbitraging between locations. This no doubt boosted the volume.
Three transactions were reported in term markets last week – one for a total of 11mlbs U3O8 to be delivered in the period 2021-25. Two smaller transactions were for the 2025-26 period.
TradeTech’s term market price indicators remain at US$29.50/lb (mid) and US$31.00/lb (long).
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