nuclear-news

OECD and IAEA warn of uranium industry’s uncertain future

OECD/IAEA Red Book   The latest edition of the ‘Red Book’ − ‘Uranium 2014: Resources, Production and Demand’ − has been released by the OECD Nuclear Energy Agency and the International Atomic Energy Agency.^8………

“Uranium miners have been hit harder by the Fukushima Daiichi accident than any other segment of the nuclear fuel cycle,” the Red Book states, and Fukushima “has eroded public confidence in nuclear power in some countries and prospects for growth in nuclear generating capacity are in turn being reduced and subject to even greater uncertainty than usual.”

Uranium’s dead cat bounce as miners play chicken  Dr Jim Green − Nuclear Monitor 2 Oct 2014 “…..the price increase has been driven by supply-side concerns and speculation instead of increased demand or even speculation regarding increased demand. UBS commodities analyst Daniel Morgan said in early September: “There’s been a few supply-side issues which has been enough for a very modest price rise. What the market really needs is a demand-side driver to get the price going and in my view we don’t have one at the moment.”²

Macquarie Group’s Stefan Ljubisavljevic predicts a uranium supply surplus for the next five years unless some unprofitable mines close.¹ Raymond James analyst David Sadowski said in May that many utilities around the world “are sitting on near-record piles” of uranium.¹¹ For example China has stockpiled about eight years’ supply (at its current rate of consumption) while it may take Japanese utilities a decade or more before they exhaust existing stockpiles.¹²

The long term price, where most uranium business is conducted, was still languishing at US$44 / lb in late August, a six-year low.³

A number of mines have been put into care-and-maintenance over the past year, including Paladin Energy’s Kayelekera mine in Malawi, and the Honeymoon mine in South Australia, owned by a Rosatom subsidiary. Many other planned mining projects have been cancelled or deferred or scaled down, and some uranium mining companies are being downgraded. Recent examples include:

• Rio Tinto announced in June that it would cut 265 of the 1,168 jobs at its Rossing mine in Namibia. In 2012, 276 workers at Rossing were fired. Production is to be reduced to just under 2,000 tonnes in 2014, down from 2,409 tonnes in 2013. Rossing Uranium Ltd. Managing Director Werner Duvenhage said: “We have to keep company operating to avoid care and maintenance or complete closure. We are significantly downgrading production targets.”⁴
• Areva and the Nigerien government have agreed to delay the start of production at the Imouraren mine. Niger and Areva will create a committee to decide on a timetable for its start-up according to market conditions. Areva CEO Luc Oursel said: “In the current context, neither Areva nor Niger are interested in dumping uranium on the market that would not find a buyer.”⁵
• Credit ratings agency Standard & Poor’s has put French nuclear power group Areva on “creditwatch negative” and will soon decide whether to downgrade its credit ratings.⁶
• Moody’s Investors Service said on September 3 that KazAtomProm, Kazakhstan’s state-controlled mining company, might lose its investment-grade credit rating as a result of “weak pricing” and other issues.⁷

the price increase has been driven by supply-side concerns and speculation instead of increased demand or even speculation regarding increased demand. UBS commodities analyst Daniel Morgan said in early September: “There’s been a few supply-side issues which has been enough for a very modest price rise. What the market really needs is a demand-side driver to get the price going and in my view we don’t have one at the moment.”²

Macquarie Group’s Stefan Ljubisavljevic predicts a uranium supply surplus for the next five years unless some unprofitable mines close.¹ Raymond James analyst David Sadowski said in May that many utilities around the world “are sitting on near-record piles” of uranium.¹¹ For example China has stockpiled about eight years’ supply (at its current rate of consumption) while it may take Japanese utilities a decade or more before they exhaust existing stockpiles.^{12………..}

OECD/IAEA Red Book

The latest edition of the ‘Red Book’ − ‘Uranium 2014: Resources, Production and Demand’ − has been released by the OECD Nuclear Energy Agency and the International Atomic Energy Agency.^8………

“Uranium miners have been hit harder by the Fukushima Daiichi accident than any other segment of the nuclear fuel cycle,” the Red Book states, and Fukushima “has eroded public confidence in nuclear power in some countries and prospects for growth in nuclear generating capacity are in turn being reduced and subject to even greater uncertainty than usual.”……..www.wiseinternational.org/nuclear-monitors

October 3, 2014 - Posted by Christina Macpherson | business and costs, Uranium