Uranium Stocks - Bombed Out But Rising

Source:

Looking at the longer term pricing outlook for uranium oxide, analysts stand generally bullish. RBC Capital Markets today released commodity analysis updates, and noted that "uranium, coal and iron ore are the only commodities for which we forecast higher annual average prices in 2009 versus 2008 levels".

Uranium oxide commodity prices were quoted at multi-year lows of USD 58/lb last month, from peaks around USD 138/lb reported in June 2007, and have recently been quoted around USD 65/lb. Dozens of listed uranium stocks have suffered stock price carnage in the wake of the halving of uranium commodity prices; Cameco, the world's biggest listed producer, is 35% off its high.

Junior and exploration uranium stocks have been sold down; some by 80% and more...

Merger and acquisition in the global uranium space has been relatively quiet since the year-ago acquisition by Areva, the world's No 3 uranium miner, of Uramin, for USD 2.5bn...

Looking at the longer term pricing outlook for uranium oxide, analysts stand generally bullish. RBC Capital Markets today released commodity analysis updates, and noted that "uranium, coal and iron ore are the only commodities for which we forecast higher annual average prices in 2009 versus 2008 levels".

RBCCM says the most significant changes to its supply/demand model for uranium were on the supply side, not least on the delaying of Cameco's Cigar Lake project by one further year to 2012 due to the most recent water inflow problem...

The uranium market continues to be affected by faltering mine start-ups, says RBCCM, "which has caused reductions to our supply forecasts". Where the average uranium price increased from just under USD 50/lb in 2006 to just under USD 100/lb last year, RBCCM forecasts USD 70/lb for this year, rising gently to USD 90/lb in 2011.

Related Articles

Get Our Streetwise Reports Newsletter Free

A valid email address is required to subscribe