Antinuclear

Nuclear bulls

Despite those low prices—or perhaps because of them—some investors are putting bets on a uranium turnaround.

Uranium Energy Corp, an exploration and production company, said it expects demand to pick up faster than production can respond. “With the uranium prices falling so low post-Fukushima, they are well below the economic incentive level needed to see new mine construction,” said Amir Adnani, CEO of Uranium Energy Corp.

As mines struggle because of the low prices, now is the time to buy them, Adnani said………….

All the acquisitions could gain value when demand revives, which could be triggered by the Japanese reactors’ coming back—at least that’s what investors hope………..

Demand for uranium is expected to grow less than 1 percent this year, leaving the industry with a net oversupply of 7 million pounds, said Nicolas Carter, senior vice president for uranium at Ux Consulting, a nuclear industry consultancy.

The world’s net oversupply of uranium may reach 18 million pounds this year, according to Ux. The difference between demand (185 million pounds) and the supply from mining (155 million pounds) is covered by 48 million pounds from secondary sources.

Those sources include government stockpiles, as well as recycled uranium from a U.S.-Russia treaty that lets U.S. utilities acquire uranium from former Soviet nuclear weapons. That treaty is set to expire this year.

However, USEC is a buyer of that Soviet uranium, and Donald said that even the expiration of the treaty will not create a shortage in the near term. The market has been prepared for the change, so it is unlikely to have a big impact on prices, he added.

Exelon, a utility company with 10 power plants and 17 reactors in Illinois, Pennsylvania and New Jersey, said that it does not expect any uranium shortage soon and that it has planned its purchases with the cessation of the Russian treaty in mind.  http://www.cnbc.com/id/100901959