U back into surplus in 2016 The recovery will not, however, be long lasting under CIMB’s modelling. Despite recent voluntary cuts to supply, including Paladin Energy’s (PDN) Kayelekeera mine in Malawi being placed into care & maintenance, and despite the end of the Russian HEU supply agreement, CIMB sees the global uranium market drifting back in to surplus by 2016. The analysts forecast a compound annual growth rate of supply of 2.5% in 2012-22, with increases driven by Kazakh mines reaching production capacity, Cameco’s Cigar Lake ramping up in Canada and the construction of new projects in Namibia.
They forecast global nuclear power capacity to increase at a compound annual growth rate of 2.0% from 2012 to 2022. The analysts are sceptical that China can actually achieve its ambitious goal of 58GW of nuclear power generation by 2020, but believe Chinese nuclear capacity will triple by that time nonetheless. They also assume the restart of Japan’s west coast reactors over the next four years.