Every two years, the World Nuclear Association (WNA) issues its “state-of-the-union-address” on the uranium industry. The 2009 meeting just ended in London England, and several themes became very apparent:
1. Uranium production is not keeping with previous forecasts
2. Demand for uranium is increasing
3. There is enough uranium to meet demand, but getting it into production will be difficult
For investors, this means that despite current low uranium prices, the market will only get better and companies with projects now in development can look forward to higher uranium prices at some time in the future.
The WNA has reduced its production estimates over the next few years by between 10 to 18%. Included in this number is reduced production from assets such as Cameco’s Cigar Lake (18 MM lbs pa), Midwest (8 MM lbs pa) and Uranium One’s Dominion (3 MM lbs pa).
On the demand side, the WNA said that installed nuclear generation capacity of 372 GWe provided about 15 percent of global electricity supply last year. The report forecasts a 12 percent increase in nuclear generation capacity to 415 GWe by 2014 and to 600 GWe by 2030.
(In a recent report, The International Atomic Energy Agency (IAEA) also increased its nuclear power projections for 2030 due to continued expansion plans for nuclear power in Asia, including China, Japan, and South Korea. The low projection foresees an installed global nuclear power capacity of about 510 GWe in 2030—a 40 percent increase over the currently installed 372 GWe. The high projection expects 810 GWe, which more than doubles today’s installed capacity. The IAEA notes these revised projections for 2030 are 8 percent higher than last year’s projections. )
1. Uranium production is not keeping with previous forecasts
2. Demand for uranium is increasing
3. There is enough uranium to meet demand, but getting it into production will be difficult
For investors, this means that despite current low uranium prices, the market will only get better and companies with projects now in development can look forward to higher uranium prices at some time in the future.
The WNA has reduced its production estimates over the next few years by between 10 to 18%. Included in this number is reduced production from assets such as Cameco’s Cigar Lake (18 MM lbs pa), Midwest (8 MM lbs pa) and Uranium One’s Dominion (3 MM lbs pa).
On the demand side, the WNA said that installed nuclear generation capacity of 372 GWe provided about 15 percent of global electricity supply last year. The report forecasts a 12 percent increase in nuclear generation capacity to 415 GWe by 2014 and to 600 GWe by 2030.
(In a recent report, The International Atomic Energy Agency (IAEA) also increased its nuclear power projections for 2030 due to continued expansion plans for nuclear power in Asia, including China, Japan, and South Korea. The low projection foresees an installed global nuclear power capacity of about 510 GWe in 2030—a 40 percent increase over the currently installed 372 GWe. The high projection expects 810 GWe, which more than doubles today’s installed capacity. The IAEA notes these revised projections for 2030 are 8 percent higher than last year’s projections. )
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