As in 2017, term uranium contract volumes increased slightly, but the number of contracts fell, and prices were generally flat in 2018. Part of the decline in the number of contracts last year was continued low interest by utilities in covering mid-term needs, either due to very low near-term requirements or because of the utility view that ample inventories were available in the market despite production cutback announcements. The term price indicator was also relatively level last year as term activity remained low to moderate and only reacted marginally to production cuts and movements in the spot price. Below is a brief review of last year’s term uranium contract activity. Term indicator fluctuates – After holding at $44 through early 2016, the term indicator fell $14 to end 2016 at $30 per pound and started to close the gap with the spot price. Although the term price oscillated in 2017, the indicator remained essentially flat, ending the year just a dollar higher than it started. However, the gap between the spot and term price widened. After increasing slightly near the end of 2017 to $31 per pound, January 2018 started off the year with a $1 decrease to $30 per pound, shadowing the further decline in the spot indicator. The term price then held flat through the end of June. Following news of additional production cuts and a couple of upward movements in the spot price during April through June, the term indicator increased by $2 at the end of July to $32 per pound. But, as additional information was revealed in August based on term offer activity, the indicator slipped back to $31.50 per pound, and held that level through the end of November.
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