Uranium Miners to Benefit from Falling Inventories

Source:

Blackmont Capital analyst George Topping expects that uranium will make gains in the second half of 2008 due to the depletion of inventories built up by nuclear power plants during the panic buying of the second half of 2007.

While the spot price for uranium continues to sag at $71 per pound, according to Ux Consulting, and long-term prices remain at $95, patient investors are waiting for prices to again rise. Spot prices hit a record $138 per pound in the summer of 2007.

So they’ll be happy to hear that Blackmont Capital analyst George Topping expects that uranium will make gains in the second half of 2008 due to the depletion of inventories built up by nuclear power plants during the panic buying of the second half of 2007.

Permitting problems in Australia, North America, Europe and Asia will lead to limited growth in new mine supply, he told clients in a note.

Mr. Topping added: Furthermore, China plans to create strategic stockpiles of other energy sources, not just oil. He expects Cameco Corp. (CCJ), the world’s largest and most liquid uranium company with more than 600 million pounds of U308 resources, to boost production from 21 million pounds in 2007 to 32 million by 2015.

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