Long term slump in uranium prices – no sign of recovery
Short-term dip in uranium prices now a long-term slump Peter Koven | Sep 26, 2012 “……..Eighteen months after the incident, uranium prices continue to hit new lows. The spot price sunk US50¢ to US$46.50 a pound this week, which is the lowest level since 2010, according to Ux Consulting. Investors briefly drove the spot price above US$135 in 2007.
The long-term price has also declined, though it is higher at US$60, reflecting the fact buyers will pay more for material delivered mid-decade or later.
TD Securities analyst Greg Barnes noted that September is usually buying season in the uranium market, so the current weakness is not a good sign.
Although sales volumes in the spot market have been very weak, there is more than enough uranium around to supply utilities, so any investing bet on the commodity is really a bet that nuclear power demand will substantially grow in the years to come….
.. questions about the future of nuclear continue to linger. Japan recently pushed reactor re-starts further into the future, while maintaining plans to phase out all nuclear power by the 2030s. And French President François Hollande reaffirmed his campaign promise to reduce the share of nuclear power in France’s energy mix to 50% from 75% currently.
“With two of the world’s most important nuclear markets questioning the longer-term outlook for nuclear power, we expect [the] uranium price to be in for another 12 months of lacklustre performance,” Mr. Barnes wrote in a note.
That view is widely shared by investors .
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