RE:U SPOT UP 6.58%Tx pmg. I am never too fussed about spot pricing of U3O8. It's a very thinly traded market generally. Its the mid to long term pricing that is the key. That is where the big deals are done although some utilities have used spot market for supplies due to low pricing there. Many long term contracts are starting to roll off and fuel buyers are in a bit of a cleft stick. Buy small amounts at spot and get it cheap or enter into long term contracts at higher prices. Also this is not like coal or oil or other commodities. U3O8 needs alot of processing before it gets to fuel stringers that you can put into a reactor. It has to be converted to UF6, enriched (for PWR/BWR designs), then fabricated into fuel. That process takes a couple of years so fuelling engineers are looking out at least two years. Believe me when I say that any fuelling engineers that has to say to his VP that his 10 billion dollar reactor will have to shutdown due to fuel shortage is going to have a very short employment half life. Long term contracts mean you don't run out. Short term contracts or spot purchases increases the risk that you will. Which one do you think fuelling engineers will opt for once supplies start getting tight.
I have heard alot of clap trap about there being 1.4 billion pounds of U3O8 above ground....enough to last more than a decade which will keep prices depressed. However when the price of Uranium was over $120/pound there was even more uranium so above ground stockpiles have DECREASED.
I predict a very violent run up in Uranium prices before 2020 and NexGen will be carried up on that wave.as will all other U stocks. Will look at IVN...- don't own that one.
Malcolm