Spot Uranium Prices Stuck Below $20 Per Pound

TradeTech’s spot uranium prices hovered below $20 per lb again last week, with buyers interested in purchases until sellers tried to push for higher prices.

TradeTech noted that last week spot market saw robust volume, but as soon as sellers pushed their offers to $20 per lb or above buying interest evaporated. Interest returned again after sellers lowered their price. This was the second-straight week that asks of $20 per lb were met with resistance.

While the spot uranium market saw increased interest, term market deals dried up with no transactions reported. Therefore; TradeTech’s term indicators were unchanged at S$24.25/lb (mid) and US$34.00/lb (long). Recently, the term market has been more optimistic than the spot market.

In company news, uranium miner Paladin could be close to insolvency. The company has 30 days to repay $277 million in debt after it failed to provide sufficient security to offtake partner Électricité de France (EDF) under a long-term supply contract.

Paladin entered into a six-year offtake agreement in 2012 with EDF. Under the agreement Paladin was contracted to deliver a total of 13.73-million pounds of uranium oxide between 2019 and 2024, in return for a cash prepayment of $200-million. But, concerns about Paladin’s ability to provide the uranium supply surfaced as the company pursued the sale of a stake in its Langer Heinrich mine and closed the Kayelekera operation.

EDF requested additional security for the repayment made in 2012, and Paladin agreed to provide additional security and appointed an independent expert to provide an assessment on whether the value of the additional security offered was sufficient. The expert said that the value of the additional security was insufficient, and now Paladin has 30 days from June 12 to repay the outstanding amount. The company has proposed a standstill of payment obligations to EDF.

Leia Toovey has a B.Sc. in geology from Simon Fraser University, and her degree had a focus on resource economics. Out of school, she started working in the booming mining industry of Vancouver, Canada, covering junior mining stocks and commodities including potash, copper, nickel, oil and gold. Then she moved to New York and worked as a commodities analyst covering a breadth of commodities, from the Baltic Dry Index through the softs. As a geologist she has a greater understanding of the exploration and extraction side of commodities, and how changes in technology and the depletion of resources impact pricing. At Economic Calendar she covers a variety of commodities, providing daily technical and fundamental analysis and assessing major market developments.