nuclear-news

Short Term Warning: One Step Forward,  Two steps BackDundee Capital Markets, 20 May 15 We highlight three short term issues of which investors should be aware, two negative, one positive. Pending TEPCO inventory sales is suggested by media speculation. We have concerns regarding negative impact to investor and utility/trader sentiment, which could manifest itself in the already thin spot uranium market. The two other news items might influence investor sentiment but essentially cancel each other out. Uranium stocks retreated yesterday, followed by the price

1) TEPCO may wish to sell some of its inventory (see link). NEGATIVE IMPACT. TEPCO apparently plans to offload some of its uranium stockpiles by the end of FY2015 in order to cut costs and counteract uncertainty over restart of idled nuclear plants according to media sources. We view this as a supply issue but information is spotty at best, and perhaps a little contradictory when talking about volumes. The article suggests that TEPCO may net US$100 MM by selling half of its excess inventory (defined as being above 2011 levels), yet it also suggests the goal is to sell all excess. This could be in the 6.5 MM lbs range, which is just below 4% of annual demand, but more accurately represents 15% of spot volumes or 3% of total uranium trading volumes last year, based on figures provided in the article. Read-through is fears that uranium may flood the spot market and other nuclear utilities might also sell inventory…….

2) Takahama injunction appeal rejected by Fukui Prefecture Court (see link). NEGATIVE IMPACT. Takahama 3 and 4 reactors are to stay off-line until Kansai Electric Power Co. can prove they are safe to Fukui District Court (previous note). This news is not so much of a demand issue as it is an investor sentiment issue. We also expect lawsuits and injunctions to be normal course of business going forward. Ironically, two other Takahama reactors (1&2) seek 20 year extensions ……