The fundamentals of the uranium story haven't altered much since the pre-2007 boom times, when the mere idea of possible uranium mineralization could double a junior's stock price, even if they were not look for the stuff in earnest. Resource Capital Research comments the uranium spot price has creep up 14 per cent in three months, but at about $US44 ($44.3) a pound remainder well below the mid-2007 peak of close to $US140 a pound. The go-go dynamics have not changed, with nuclear seen as satisfying a crucial non-carbon energy gap. We won't go near the discuss about whether nuclear is clean energy or not but will simply note that there are 493 planned or proposed reactors, with 59 under construction.
Lest anyone gets excited about a do again of $US140 a pound prices, new supply is likely to come from sources in Kazakhstan, Paladin's second Namibian project, Kayelekera and, nearby, Energy Resources Australia's Ranger mine and Olympic Dam's vaunted $5 billion development. RCR's John Wilson expect the spot price to bottom at $US45-$US50 a pound, with the view of retraction in the present half as supply increases. "With stronger global production predictable in the second half of 2010, there is possible for the spot price to fall back slightly, though we expect the long-term price to remain well support on planned inventory purchases from China, India, Japan and Germany," he says. Look beyond the small term, though, and a supply shortfall emerges.
One contributing factor is that the supply of former Soviet weapons-grade uranium is wearing down. For investors, there's better value in the uranium sector but the winners and losers remain difficult to pick. Criterion has always been chary about the opportunists who lift $5 million or so to poke around for the stuff. Most of these have fallen by the wayside and the producers' presentation has been mixed. Paladin should be celebrated for opening not one but two African mines, Langer Heinrich in Namibia and Kayelekera in Malawi. Paladin is meant to be increasing production from its African mines to 7.3 million pounds this year, more than double final year's effort. Yet a first-quarter report showed manufacture at 1.36 million pounds, but with sales and the received price both 20 per cent lower than they were in the earlier quarter.
Lest anyone gets excited about a do again of $US140 a pound prices, new supply is likely to come from sources in Kazakhstan, Paladin's second Namibian project, Kayelekera and, nearby, Energy Resources Australia's Ranger mine and Olympic Dam's vaunted $5 billion development. RCR's John Wilson expect the spot price to bottom at $US45-$US50 a pound, with the view of retraction in the present half as supply increases. "With stronger global production predictable in the second half of 2010, there is possible for the spot price to fall back slightly, though we expect the long-term price to remain well support on planned inventory purchases from China, India, Japan and Germany," he says. Look beyond the small term, though, and a supply shortfall emerges.
One contributing factor is that the supply of former Soviet weapons-grade uranium is wearing down. For investors, there's better value in the uranium sector but the winners and losers remain difficult to pick. Criterion has always been chary about the opportunists who lift $5 million or so to poke around for the stuff. Most of these have fallen by the wayside and the producers' presentation has been mixed. Paladin should be celebrated for opening not one but two African mines, Langer Heinrich in Namibia and Kayelekera in Malawi. Paladin is meant to be increasing production from its African mines to 7.3 million pounds this year, more than double final year's effort. Yet a first-quarter report showed manufacture at 1.36 million pounds, but with sales and the received price both 20 per cent lower than they were in the earlier quarter.
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