Uranium Market Outlook - Q3, 2018

  • ID: 4730345
  • Report
  • 30 Pages
  • Metal Commodities Investment Platform
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Optimism on a Turn-Around of The Uranium Market Should Not be Overstated

FEATURED COMPANIES

  • A-Cap Resources
  • Bannerman Resources
  • Blue Sky Uranium
  • Deep Yellow
  • GoviEx
  • Plateau Energy Metals
  • MORE

Eleven per cent of the World’s energy supply comes from 440 nuclear power plants, with 60 more reactors under construction and another 160 are planned around the world. With the world using more energy per person every decade, and an exponentially growing number of people, the demand for nuclear power will only increase in the decades ahead.

Uranium-produced radiation, moreover, is used to treat cancer, irradiate food against disease, study cells, detect flaws in metals and other structures, and create smoke detectors. Of course, it supplies the fuel for nuclear submarines and weapons, and the material for depleted uranium shells. In short, most of our lives will be shaped, and often saved, by uranium.

With all of these uses, uranium has a complex and rapidly-growing global market, and since 2005 the Uranium letter International has been one of the World’s finest sources of information for investing in the international uranium equity markets.

The most recent issue, for example, noted that the geopolitical shift from western to emerging countries has had a crucial effect on the uranium market; for example, strongly growing uranium demand from China and Russia will be mostly supplied by already existing international joint venture agreements with Kazakhstan.

In September 2015, Jonathan Hinze of UxConsulting Company (UxC) at the WNA Annual Symposium said that with global uranium inventories upwards of 1.1billion pounds U3O8 equivalent (423,100 tU) were likely to drive the uranium market for some time to come, affecting not just uranium suppliers, but also the conversion ad enrichment industries. At that time the U3O8 spot price and long-term price were $36.50/lb and $45.00/lb, respectively

Today, 3 years later, at prices of $26.20 and $31.50, respectively, China, Russia and India together are currently accounting for 30 reactors under construction and 72 reactors planned, representing 54% and 47% respectively of the world total. With the required uranium to feed future operational reactors, this is broadly seen as the key driver of a strong uranium price recovery.

Based on the current supply situation, with the USA with 99 reactors hosting 22% of the World’s 452 operable reactors and in 2017 having required 18,996 tonnes U (30% of the world total of 65,014 tonnes), according to the WNA, it is notable that Russia supplies 45.5% of US imports of enriched uranium and Canada 90.6% of natural uranium imports. This means that for the USA there is no urgent need to lower imports of more than 90% of the uranium it uses other than for political tensions.

The overview below of world nuclear power reactors and uranium required in 2017 confirms the dominance of the U.S. on nuclear energy generation and as such the provider if clean energy, despite an only limited added share of renewable's.

Considering that globalization is creating a new economical world order, it is interesting to see which countries are supplying uranium. This is of crucial importance for the course of uranium pricing and is disturbing the long-awaited strong recovery to a pre-Fukushima price level of $65-70/lb to enable an economically viable production.

Anticipating a strong growth of nuclear reactors under construction and of planned reactors, led by China, Russia and India, which three emerging countries accounting for 54% of reactors under construction and 47% planned, it is important to know which countries will meet supply of the required uranium.

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FEATURED COMPANIES

  • A-Cap Resources
  • Bannerman Resources
  • Blue Sky Uranium
  • Deep Yellow
  • GoviEx
  • Plateau Energy Metals
  • MORE
  1. Optimism on a turn-around of the uranium market should not be overstated
  2. Shift In geological blocks is dictating non-transparent uranium market
  3. Paris Climate Agreement confirms essential contribution of nuclear energy as the only large-scale source to limit global warming
  4. IEA says policy change is needed to raise nuclear capacity
  5. WNA expects new nuclear capacity in 2018 and 2019 to increase to more than 26 GWe, to meet the overall target for its Harmony programme
  6. China and Russia to dominate international sales of nuclear plants
  7. European Union, profiling itself as a leader in promoting action on climate change but fails to act accordingly
  8. Phasing out Germany’s nuclear reactors in conflict with EU energy policy
  9. United States dominates global energy markets
  10. Fossil fuels remain to have most influence on Trump’s energy policy
  11. US leadership on climate change not affected by withdrawal from Paris Climate Agreement
  12. American uranium imports by supplying country
  13. Political tensions flare between the US and Russia could put the vital supply line of enriched uranium exported from Russia to the United States at serious risk
  14. Call for US government to revitalize its nuclear industry
  15. US Congress approves US$ 1.2 billion budget for nuclear energy
  16. US uranium mine production in 2017 55% less than in 2016
  17. Energy Fuels and Ur-Energy jointly filed a petition with the U.S. Commerce Department to investigate effects of uranium imports on U.S. national energy
  18. Japan releases draft of updated basic engineering policy for 2030
  19. China to dominate future global nuclear power market, including expansion abroad
  20. Including environmental protection, vigorous development of nuclear power is required
  21. China switches focus of Belt and Road Initiative from Asian to African countries
  22. China deepens African ties with $ 60 billion pledge
  23. China National Nuclear Corporation holds 25% in Paladin Energy’s Langer Heinrich uranium mine in Namibia
  24. CNNC International holds largest equity position in SOMINA joint venture in Niger
  25. Restructuring JV Inkai between Kazatomprom and Cameco effected on January 1, 2018 Cameco’s ownership interest lowered from 60% to 40%
  26. Inkai Mineral Reserves and Mineral Resources of the Inkai operations
  27. Yellowcake makes first uranium purchase of 8.81 million pounds from Kazatomprom
  28. Canada’s 2018 uranium production – fully provided by Cameco, expected to fall by 47%
  29. Exploration costs
  30. Financial and operating results Q2 2018
  31. Updated 2018 outlook
  32. 2019 Outlook for production, delivery volumes and purchases
  33. Uranium mine ban for Western Australia and Queensland jeopardizes the country’s reputation as the world’s third-ranking uranium producer
  34. ERA Energy Resources of Australia – 68% owned by Rio Tinto
  35. Aiming to supply 25% of electricity from nuclear power by 2050,
  36. India plans to tenfold uranium output growth
  37. Other countries to be in favour of nuclear energy
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  • A-Cap Resources
  • Aura Energy
  • Bannerman Resources
  • Berkeley Energia
  • Blue Sky Uranium
  • Cameco
  • Deep Yellow
  • Forsys Metals
  • GoviEx
  • Kazatomprom
  • Plateau Energy Metals
  • U3O8 Corp
  • UxConsulting Company
  • Yellowcake
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