Irina Dorokhova - Kursiv reports on the Russian view of market-price conditions. The players keep talking about an excessive supply and all major uranium producers except for Kazatomprom had to cut production. Only Kazatomprom and Cameco managed to increase their revenue in 2014. In the meantime, China, India, and Russia have been commissioning new reactors. Cameco has run first batches of ore through its Cigar Lake plant (design capacity stands at 18,600 t U per annum).
CGNPC of China plans to start production at its Husab mine in Namibia this May. All this new supply will meet the demand from new reactor builds. Hence, the anticipated uranium price rise due to new demand may not happen as main players, and first of all China, will try to ensure their independence from external supply. The main reason for price correction may be not the growing demand but the producers inability to meet the consumers price expectations.
Japanese demand is no longer a factor in the uranium marketplace as not a single reactor was restarted in 2014. Only two reactors at the Takahama powerplant were approved for restart last December and, since the Fukushima incident in March 2011, only one reactor at the Oi plant was restarted in July 2012.
With the purchase of Uranium One, Russia and the AtomRedmetzoloto (ARMZ) has probably the cheapest, most environmentally-friendly, and longest lasting source of uranium in the world. In its 2014 annual report, Uranium One reported production of 4032 t U (5117 t U in 2013) at a cash cost of 14 dollars per pound U3O8. ($16 dollars per pound in 2013). The dramatic drop in production was attributed to a suspension of Uranium One mining rights at the Akdala, South Inkai, and Kharasan mines between 4 June and 17 October 2014 when all yellowcake production was accounted for as Kazatomprom. Without this re-attribution, Uranium One production was to stand at 4885 t U (5715 t U3O8).
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