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Uranium, a Raging Bull

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mmmmining said:
An article said China is going to extract uranium from combusted coal ashes generated by coal-fired power plant.

http://biz.yahoo.com/ccn/070116/200701160367518001.html?.v=1

Also it is true you can extract uranium from ocean water. According to my memory, the cost is about US$100/lb.

The question is if uranium price is too high, it will kill the uranium boom instantly by new technology, and new sources of supply, of course, reduced demand. Just look at oil.
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According to the article the new technology being tested for generating uranium from coal ash, says there is the potential for as much as 273,000 pounds per year. "The local coal has a high ash content (approximately 20-30%) and the coal uranium content varies from about 20-315 parts per million ("ppm") and averages about 65 ppm U" . Thats only about 120 tonnes of very low grade uranium a year from 3 coal fierd plants and the Chinese are under pressure to reduce to number of coal plants and cut emmissions as thousands are dying from breathing the polluted air, and it costs the economy $25 billion a year in health expenditure and lost labor productivity alone.
And as for the uranium from seawater, it looks like that would take a while!!
And in Japan an adsorption method using polymeric adsorbents capable of specifically recovering uranium from seawater is reported to be economically feasible. A uranium-specific nonwoven fabric was used as the adsorbent packed in an adsorption cage 16 m2 in cross-sectional area and 16 cm in height. We submerged three adsorption cages in the Pacific Ocean at a depth of 20 m at 7 km offshore of Japan. The three adsorption cages consisted of stacks of 52 000 sheets of the uranium-specific non-woven fabric with a total mass of 350 kg. The total amount of uranium recovered by the nonwoven fabric was >1 kg in terms of yellow cake during a total submersion time of 240 days in the ocean.
http://www.ans.org/pubs/journals/nt/va-144-2-274-278

For mine ...the smart money is digging it up the ol fashioned way :D
 
The world is waiting for the Cameco results on the new water-mine...

So: If the problems are substantially there we will see higher prices very soon.

Much higher.
 
bigt said:
Is this the same norman sydney mcleary involved with arafura?
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Yes it is... he was the founder, he's also a major shareholder in Stonehenge Metals (SHE) tin miner in Tassie with nickel ground near AGM's Avebury deposit.
Cheers
 
It seems that the Uranium Fever is not over yet for mining companies (hopefully), although some members come up with other ways how to obtain this yellow cake, such as: from coal or sea water, see above.

http://www.stockinterview.com/News/01182007/Uranium-Year-Ahead.html

Well, to confess my feelings I am divided.
On one hand many are still optimistic and see another rise in uranium spot price which would most probably mean rise in share price of decent uranium companies (bottom line - which are they?).
On the other hand I would say that significant number of people are talking about bear market & economical depression. At least it seems to me, although I have been on the financial market just for about 2 years. Maybe there have always been talks about crash, instability, etc…
Even now some uranium companies, such as: ERA, PLD, BMN, AGS, SMM drop significantly during one day (so called correction). I would like to know what would happen if there is lets say a crash on Wall Street and Dow would finish -20% lower. Would it be something like -50% in spot price for these not blue chips? Hmmm, probably.

Anyway let stay optimistic, try to minimize risk and good luck to all.
 
mmmmining said:
An article said China is going to extract uranium from combusted coal ashes generated by coal-fired power plant.

http://biz.yahoo.com/ccn/070116/200701160367518001.html?.v=1

Also it is true you can extract uranium from ocean water. According to my memory, the cost is about US$100/lb.

The question is if uranium price is too high, it will kill the uranium boom instantly by new technology, and new sources of supply, of course, reduced demand. Just look at oil.

I guess we should not be excited to see triple digits uranium price.

Inflation adjusted price used by some famous analyst is misleading because commodity price is decided by demand and supply. Any price spike is caused by serious imbalance between demand and supply, not on cost basis. The imbalance could be caused by disruption of supply, such as war, etc. Unless you can duplicate the demand and supply situation of last price spike, you cannot use it for the future price predication meaningfully.

But inflation adjusted price is good for government to increase taxes.
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Hi again,
No, I don't think I was trying to predict the future price, just trying to see where we are right now when compared to previous price action.
The inflation adjusted price is still relevant because at any one moment in time all factors are supposedly reflected in the current price, including supply & demand.
As far as having an objective look to see where we are in this current uranium price cycle, and referring back to a previous cycle to compare with, it is indeed valid to compare the two on an inflation adjusted basis. If only to know you are comparing apples to apples.
I still can't see why the price isn't higher if the supply demand equation is supposedly so far out of balance, as the current price of any commodity is determined by all known factors currently in force. So, the companies that actually use the stuff must not foresee a supply squeeze and the current price reflects that ie sufficient supply for future needs. Otherwise they would be buying all that they could and putting even more pressure on the price.
Anyway, if we can make money on the premise of a bubble then who's complaining?. Just my analysis :2twocents
 
When Canadian supplies reach anticipated levels in 2008, after setbacks last year, the uranium price may well look less bullish.
 
noirua said:
When Canadian supplies reach anticipated levels in 2008, after setbacks last year, the uranium price may well look less bullish.
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That is not taking into consideration the need for more U in the future. Thats assuming the 20% nuclear energy cunsumtion is going to continue. It seems pretty obvious burning coal is not going to continue much longer and the need for more uranium will rise.
 
Uncle Festivus said:
Hi again,
The inflation adjusted price is still relevant because at any one moment in time all factors are supposedly reflected in the current price, including supply & demand.
Click to expand...
The inflation adjusted moving average price maybe more useful than peak price of last cycle.

Looks like uranium stocks are changing gear. Different stocks go to different direction. The all up phase seems over.
 
Yes, that would be interesting - an inflation adjusted chart - that would show the real story. Any takers?. Where would you get this data?. I still think there are gains to be had in Uranium, but beware a swift about face.

A bit about coal. As far as Australia is concerned, coal is with us for the foreseeable future, ie for the next 10 years min, 15 realistically, unless there is a breakthrough in other energy technology. (As an aside, I think household fuel cell technology will be making inroads soon, maybe the next sector to look at???)
 
Uncle Festivus said:
Yes, that would be interesting - an inflation adjusted chart - that would show the real story. Any takers?. Where would you get this data?. I still think there are gains to be had in Uranium, but beware a swift about face.

A bit about coal. As far as Australia is concerned, coal is with us for the foreseeable future, ie for the next 10 years min, 15 realistically, unless there is a breakthrough in other energy technology. (As an aside, I think household fuel cell technology will be making inroads soon, maybe the next sector to look at???)
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Coal still works out much cheaper than oil, downside, that coal needs more storage space. New technology, particularly from Germany will increase the use of underground power stations and for the use of lignite, it being the most available coal in the world.

Whilst NSW and WA are against Uranium Exploration, banned by State Law - "I'm drilling for copper and gold, so I can't see that there Uranium" -, then, they are likely to give further go aheads for coal mining.
 
not sure if this has been posted here - couldn't find it - anyway good report

http://www.eurekareport.com.au/iis/...9DBA4CA25726600142C06?OpenDocument&loc=center

and worth noting this....

Before the flooding of the Cameco mine, uranium was enjoying strong support from increasing global demand and a supply deficit forecast until at least 2009 (although not everyone was convinced about this fact). Since the flooding the sector, and those following it, simply had to come to terms with the fact that about 10% of projected new supply will not become available anytime soon.

Cameco, the world's largest uranium producer, representing about 21% of global supply, is expected to update the market on its Cigar Lake project on February 6 and 7. No doubt, this will be the most anticipated event within the sector for a long time.

Deutsche Bank analysts believe the flooding has altered the industry for many years to come. "Like other commodities which have witnessed phenomenal price increases, the uranium market will eventually restrain itself as exploration and production increases and newer forms of supply are introduced to the market. Nevertheless, until this situation unfolds, we expect continued strength and greater increases in the spot price," the report says.

So far Cameco management has only conceded that the flooding at Cigar Lake might delay production by about 12 months. Deutsche Bank believes the market has priced in a delay by two years.

Regardless of whether this is true or false, the broker believes it will take years to bring supply and demand in balance, even when scenarios such as the potential release of secondary material by either Russia or the US Government are taken into account.
 
brokers yearly average price for u3o8 from the eureka report...

2007 2008 2009
Deutsche Bank 100 105 90
Merrill Lynch 75 80
RBC Capital 100
Scotiabank 80
Raymond James 90 100 100
JP Morgan 90 80 80

Overall average $89.17 $91.25 $90.00


so we're looking at US$90/lb on average for next three years - i work through what this means for Paladin's profits on the PDN thread.....
 
56gsa said:
brokers yearly average price for u3o8 from the eureka report...

2007 2008 2009
Deutsche Bank 100 105 90
Merrill Lynch 75 80
RBC Capital 100
Scotiabank 80
Raymond James 90 100 100
JP Morgan 90 80 80

Overall average $89.17 $91.25 $90.00


so we're looking at US$90/lb on average for next three years - i work through what this means for Paladin's profits on the PDN thread.....
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Their forecast is as good as rolling a dice. Their tracking records are bad, very bad. Try James Dines' forecast.
 
Strange price action today. Both ERA and PDN (producers) are significantly higher. U spot price moving higher, or CAMECO in further trouble? CCJ down $2.19 in NYSE.
 
Cameco Tries to Respond To Speculation, Share Price Fall
FN Arena News - January 23 2007

By Rudi Filapek-Vandyck

World number one uranium producer Cameco saw its shares tumble more than 5% on the Toronto Stock Exchange as investors, and investor chat rooms in particular, were frenetically debating the severity of the problems at the company's Cigar Lake project.

As debates heated up, Cameco spokesperson Lyle Krahn sought to allay fears of Cameco having to abandon the project by talking to Bloomberg who quoted him as "speculation that the mine's development would be delayed indefinitely is "absolutely untrue"."

Cameco's intention is to update the market on Cigar Lake by the end of January while Krahn has flagged another media release between now and February 6-7 when the company is scheduled to inform investors about its December quarter performance as well as its operations.

Cameco has thus far stuck to its official line that production at Cigar Lake, expected to produce circa 10% of future annual market supply, is likely to be deferred by one year. Several experts and market watchers believe this is too optimistic though. Deutsche Bank analysts calculated recently that the market has already priced in a delay of two years in the U3O8 (uranium oxide) spot market.

Spot uranium has remained at US$72/lb so far in 2007. This is double the US$35/lb at the start of 2006.
 

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