It was not long ago that uranium prices began making an upward turn following a period of production problems in the early 2000s. At the time, future supply and demand were out of balance due to the failure of the spot price to reflect a looming future supply shortage. Although demand was increasing moderately, and inventories were quickly declining, producers were quite fearful of making huge investments in new mines if prices were only going to pull back as they had several years earlier in the short-lived price rise of 1996.
By the late 2000s, new demand had emerged from China, India, and Russia, as these countries sought to dramatically increase their nuclear power capabilities. Along with growing investor interest, high utility uncovered requirements, and slow-responding production, this heightened demand was a key reason why the spot price escalated to $136 per pound U3O8 in 2007.
However, in 2011, the uranium market was hit hard by the Fukushima accident, which stalled total growth in reactor requirements and is still taking its toll today. In addition, the evolving shale gas revolution has made it difficult for many U.S. merchant nuclear plants to compete with gas-fired plants, leading some of these plants to shut down early.
As much of Japan's nuclear fleet remains offline, utility and supplier inventories have amassed over the past several years. Due to the current oversupply situation, prices have overshot where the true equilibrium likely should be, especially given that 59% of current production is at a full cost greater than $20 per pound. With production cutbacks occurring, the market could find itself in a volatile situation several years from now as Chinese nuclear generation is still expected to grow at a rapid rate, and new countries such as the U.A.E. and Saudi Arabia are advancing their nuclear power programs.
With global reactor requirements still increasing in the long-term, more requisite new production will be needed, especially with several large uranium projects slated to be shut down in the next decade. In addition to transitioning from an inventory-driven market to a production-driven one, a large component of production is linked to regions of the world with higher than average geopolitical risk, making the market more vulnerable to the potential for future disruptions.
The UxC Uranium Market Outlook (UMO) report is designed to examine developments and discerning trends in the market, including the likely future course of price under different scenarios. The entire report is updated quarterly so that subscribers have the most current information and analyses on which to base their decisions. Updates of leading market indicators are also provided on a monthly basis so you are never too out of touch with the market.
A table of contents from a previous report has been provided for your review.
Special Issue Offer
Each quarter, UxC releases a new Uranium Market Outlook (UMO) that contains detailed up-to-date analysis on the uranium market.
UxC makes available any individual report for sale as a stand alone report.
In each UMO, topical essays are devoted to topics such as current market developments, major market events, and long-term market trends.
This quarter’s essay, “Examining Section 232” analyzes the Section 232 petition filed by U.S. producers’ Energy Fuels and Ur-Energy, alleging that the decline of U.S. uranium production is due to the unfair advantage of state-owned and state-supported producers under the Russian sphere of influence.
UxC makes this quarter's UMO available as a special single report order
at a rate of US$5,000.00. An online order form has been provided.
Please note that this special offer only covers this quarter's UMO report.
It does not include services associated with a full year's subscription as discussed below: such as three additional quarterly reports,
the monthly leading spot price indicator updates, and access to UxC's Subscriber Services website.
The Uranium Market Outlook is a quarterly report on the uranium market that examines recent and prospective spot and long-term
contract market activity, supply and demand trends, supplier developments, and the outlook for
prices over the short and long term. The UMO also includes a topical essay on important
developments that are shaping the market and detailed findings from UxC's proprietary indicator
system that analyzes trends in key factors influencing future prices.
UxC also includes uranium demand forecasts based on the proprietary UxC Requirements Model (URM).
Please see our product flier in Adobe Acrobat PDF format.
- An executive summary is provided with a concise overview of the current market situation. The executive summary is also e-mailed to subscribers.
- Chapter 1 contains a topical essay that addresses key events and their potential impact on the market. Examples of past essays are listed here.
- In Chapter 2 - Recent Contracting Review, recent spot and long-term market activity over the previous quarter is reviewed, and current contract terms and conditions are summarized.
- Chapter 3 - Requirements and Demand Outlook looks at recent developments affecting reactor requirements in the world’s regional markets, along with a review of requirements forecasts. An updated view on uncovered utility reactor requirements is also presented. This section also examines the spot demand outlook over the next three years and the long-term contract demand outlook over the next 12 months.
- Chapter 4 - Production and Supply Outlook reviews recent production developments worldwide and the current status of major world projects. Also examined are secondary supplies projected to influence the market over the forecast period.
- Following the production and supply chapter is Chapter 5 - Near-Term Technical Analysis & Spot Market Indicators, which presents a technical analysis of near-term price movements and a detailed update of the long-term spot price indicators, designed by UxC to quantify market factors that are affecting price outlook two years forward. Included with a subscription to the quarterly report are monthly updates of UxC's near-term price indicators, a predictive tool used to gauge potential spot movements two to three months forward.
- In the final chapter of this report, Chapter 6 - Market Outlook and Price Forecast, the market is analyzed in terms of a one-year and intermediate-term perspectives, and forecasts are presented for the spot price and long-term base price through 2035. The near-term availability of supply by price, market trends, and bullish and bearish arguments for price movements are also presented in this chapter.
- The report contains two appendices. The first appendix, Appendix A - Forecasting Methodology, details the various methodologies used in this report to forecast price, supply, demand, and market price indicators. The second appendix, Appendix B - Statistical Review, contains tables and figures that provide additional and expanded data to those presented in the body of the report.
Who should read this report
- Fuel buyers
- Policy makers