RE:RE:All these mine shutdownsVery astute observations Canwin21. I agree. However Utilites really do not care very much about the uranium mining industry. The reason is because the proportion of operation costs of a reactor arising from fuel is less than 5% and that includes enrichment and fuel fabrication. A doubling or a tripling of the cost of unprocessed fuel (U3O8) has almost no effect on the price of electricity produced. When the price increases dramatically (as it will do) there are companies and governments that can fill the short term need quickly without the need for new mines. However that stockpile (in companies like Uranium Participation Corporation) will not last very long with all the new reactors coming on stream. The yawning gap will open up in around 2022. Unlike last time this happened there are no new mines on the horizon so my expectation is that prices will remain much higher and for much longer than before. In other words we will not have a "spike" in Uranium prices but a prolonged period of high prices while supply catches up with demand.And that may take years.
My best guess (and it is a guess) is that contracting will start again in 2019 - 2020 which will drive the price up and once all the readily available stocks of material are sold off there will be another dramatic leg up around 2022 to 2023 when it is realised there is insufficient production to meet increased demand.
I have stated here before that I expect Uranium to top $200/lb...not this year...but starting around 2020 and after that the sky is the limit. If that makes me sound like a pumper so be it...but that is the reality and what the facts are telling me.
450 power plants and growing need an awful lot of Uranium to keep running and the average size is increasing (a factor often overlooked by analysts). Just as bigger car engines need more fuel so also do bigger reactors need more fuel.
Nearly all reactors curently under construction (56 of them) are 1000MW or greater,
So it's not just the number of reactors increasing but the fuel damand per reactor is also increasing.
Still need a little more patience to reap the rewards folks.
Malcolm