U Spot up to $55Uranium Price, Trading Rise for Fourth Week as Output Curbed
By Yuriy Humber
Nov. 24 (Bloomberg) -- Uranium gained for a fourth week, thelongest winning streak this year, as producers curb developmentof mines and utilities bought on concern prices will keep rising.
Uranium-oxide concentrate for immediate delivery rose $2 to$55 a pound, Denver-based pricing service TradeTech LLC said in areport Nov. 21. Weekly demand totaled 6.5 million pounds, about 2million pounds more than supply. Last week saw nine deals for 1.4million pounds, 8 percent more than the previous week.
``Spot uranium demand remains steady,'' TradeTech said.``Negative news from a variety of producers and the increase inprices over the past few weeks have spurred a number of off-market inquiries.''
Uranium has gained $10 a pound in the past four weeks afterproducers including Cameco, the world's biggest, cut output andspending on new mines because of the global credit crunch anddeclining prices this year.
``Supply is choking off and demand is rising,'' said JohnWong, a fund manager in London at CQS UK LLP, which has $10billion under management. ``The forced sellers we saw two monthsago are gone. In these capital markets, the producers can't raisecash for new projects, so it'll be 2013 before we see any newsupply of significance.''
China National Nuclear Corp., the nation's biggest nuclearplant builder, said Nov. 18 that weaker spot prices will hurt thecountry's plans to explore for the fuel at home and overseas.
China may raise its 2020 nuclear power capacity target to atleast 70 million kilowatts from 40 million kilowatts to help cutgreenhouse-gas emissions and curb the effect on power productionof delays in transporting coal, the Xinhua News Agency said thismonth, citing a state official.
The country was forced to shut some coal-fired plants inJanuary after the worst snowstorms in 50 years wrecked railwaylines and hampered fuel transportation, leading to electricityshortages affecting half of the nation's 31 provinces. Chinarelies on coal for two-thirds of its energy needs.
To contact the reporter on this story:Yuriy Humber in Moscow atyhumber@bloomberg.net