Uranium Prices Could Soar to $140 Per Lb

Analysts unanimously expect the uranium market will go through another bull run, and this week a managing director at Bannerman Resources said uranium could climb past $140 per lb in this upcoming bull run.

According to Australian Mining, speaking at the Africa Downunder conference in Perth this week, Bannerman Resources managing director Brandon Munro said the current decade-low prices for uranium were unsustainable. “The uranium spot price is languishing at a decade low price of $US20 per pound. While all commodity markets are cyclical – and it is said that the best remedy for low prices is low prices – uranium has unique dynamics that point to an abrupt return to higher prices when its time comes.”

While uranium prices collapsed following the Fukushima nuclear disaster, the commodity was in a bear market before. Munro said the bear market actually began when the Soviet Union collapsed, and its recovery was set back by the Great Recession and the Fukushima disaster.

Munro added that the depth and magnitude of the bear market will lead the way to another big bull market in which uranium prices could easily climb above $140 per lb., as they did during their last bull run.

One of the major supportive cases for uranium’s long term demand outlook is China’s nuclear power growth. The country is at various stages of building dozens of new nuclear power plants that will require a great deal of uranium to operate. While this growth is undergoing, security concerns still remain – but the International Energy Agency just carried out a ten-day International Physical Protection Advisory Service (IPPAS) mission at the Chinese government’s request. THE IEA concluded that the country’s nuclear security activities are “strong and sustainable.”

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.