In a presentation to the New York Chapter of the Society for Mining, Metallurgy and Exploration, Fletcher Newton, CEO for Power Resources, a subsidiary of Cameco, asserted that there is not enough urnaium to meet current needs, let alone future demand, the article stated.
Newton said the Newchem Report, which he called one of the best sources for uranium information, has raised "significant questions about future supply," predicting a shortage of 100 million pounds of uranium over the next decade. He said the Chinese plan to build 22 reactors, and have the political will and power to accomplish the task.
The article also quoted Curt Steel, Senior Trader for RWE NUKEM AG, which is Germany's largest trading company for uranium, who predicted a "moderate overall demand increase right now that will sustain itself" in the years to come. "Production plus secondary supplies are adequate to fill requirements," Steele told his audience of analysts, economists, and investment funds.
Steel believes re-enrichment of uranium tailings will create more uranium. For instance, rich U.S. Department of Energy tailings could produce an additional 20,000 tonnes of uranium, he suggested.
Research Analyst Chris Munford of the CPM Group said in the article that uranium prices have already tripled within the past 24 months. Prices for conversion--which converts uranium into use for a reactor--are at least 50% higher than they have ever been in history.
Among the key fundamentals which investors should consider in the uranium market, Munford noted, are the increased demand for uranium, and the chronic shortage of mine supply as well as the potential shortage of conversion capacity in facilities. Munford also noted that there is a boom in nuclear power plant construction. Meanwhile, consumer uranium stocks have been reduced while investor interest in the commodity has increased. Finally, U.S. and Russian military stockpiles are dwindling, he added.
