Uranium trading market in midst of fundamental shift: industry sources

摘要

The uranium market is in the midst of a fundamental shift, as investment entities focus on acquiring material that would be held off the market for years until U3O8 prices rise substantially, according to market sources. This is a change from what earlier in the decade had been a market driven primarily by utilities buying U3O8 to meet their long-term or immediate needs from producers and brokers. In mid-decade the lion’s share of U3O8 purchases was made by utilities taking advantage of low-interest purchase deals offered by financial intermediaries, according to market sources. Yellow Cake PLC held an initial public offering of its shares in July on the London Stock Exchange's Alternative Investment Market and contracted to buy 8.4 million lb U3O8 from Kazatomprom, with a nineyear option to buy up to $100 million worth of material annually from the producer. And in October the El Segundo, California-based Uranium Trading Corp. said it was seeking to raise $50 million via an initial public offering that would provide “a pathway for interested investors to invest in the storage of physical uranium with the goal of achieving capital appreciation as a result of price increases.”