Uranium May Rise to $75 a Pound in 2012 After Fukuhttps://www.bloomberg.com/news/2011-05-13/uranium-may-rise-to-75-a-pound-next-year-on-japan-boost-uranium-one-says.html
Uranium May Rise to $75 a Pound in 2012 After Fukushima, Uranium One Says
ByBloomberg News-May 13, 2011 4:12 AM ET
Uranium prices may trade from $70 to$75 a pound next year after problems at Japan’s Fukushima Dai-Ichi nuclear power plant are resolved, Fletcher Newton, a vicepresident at Uranium One Inc. (UUU), said in Beijing.
The price of uranium oxide concentrate for immediatedelivery will be from $55 to $65 a pound this year, Newton toldBloomberg before a conference today.
“You simply can’t build a uranium mine at these prices,”Newton said. When Japan starts to experience a power shortagethis summer “the world will look at it and realize that theissues we face are the same as before” in meeting nuclear powerrequirements. New uranium mines need a price of $85 a poundbefore they are economically viable, Newton said.
The spot price for the nuclear fuel has fallen about 15percent since Tokyo Electric Power Co.’s Fukushima Dai-Ichiatomic power station was damaged on March 11 by an earthquakeand tsunami, sparking the worst nuclear crisis in 25 years.Prices gained $1.25 to $56.50 a pound in the seven days throughMay 9, based on the most competitive offer tracked by Roswell,Georgia-based Ux Consulting Co. on May 10.
Canada-based Uranium One, controlled by Russia’s state-owned nuclear company Rosatom Corp., has had talks aboutentering the Chinese market, according to Newton. “Nothing isconcrete about those talks,” he said.
China Demand
China’s “demand growth puts a floor on uranium prices andhas helped to drive prices higher,” Jonathan Hinze, vicepresident at Ux Consulting, told the conference. “China newscan swing spot prices rapidly."
China, building more reactors than any other country,stopped approving new plants ‘‘until safety and improved long-term development plans are cleared,’’ according to a March 16statement by the State Council. The country has approved 34reactors, of which 26 are under construction, according to theWorld Nuclear Association’s website.
Small mines will have to close if uranium falls below $50 apound and the ‘‘most-desired’’ level is $65 to $70 a pounds,Zhou Zhenxing, chairman of the uranium unit at China GuangdongNuclear Power Group Co., the nation’s second-largest reactorbuilder, said at the conference today.
China Guangdong Nuclear’s uranium mines in the northwesternprovince of Xinjiang and Guangdong in the south may start outputin 2013 and have a capacity of 500 metric tons a year each, Zhousaid.
The nation’s proven and estimated uranium resources arecurrently 10th in the world, according to Zhou. ‘‘The scale ofnuclear power development will be world number one, so we needto secure more uranium supplies,” he said.
Kazakhstan and Africa will supply 70 percent of worlduranium this decade, Uranium One’s Newton said. The company hasstakes in mines in Kazakhstan and the U.S., according to itswebsite.
-Baizhen Chua and Wang Ying. Editors: