Updates In Uranium

May 17, 2007 | By | Reply More

The effect of futures trading in the energy metal has so far been subdued.

Bearing in mind that unlike other futures markets physical delivery cannot be made, the volume of trades during the opening week has been considered as reasonably optimistic for volume to develop.

Obviously the almost continuous price increase that uranium has enjoyed for the last 5 years has attracted speculators interest and that coupled with the much publicized growth prospects for nuclear power as a green alternative to fossil fuels is likely to awaken increasing interest on Wall St. and professional investors world wide.

Supply shortfalls are expected until 2010 and probably beyond dependent upon the number of nuclear power plants in operation or about to be commissioned and those in the various stages of planning and construction, both of which are steadily increasing.

It is hard to see any alternative to an increasing, or at the very least a stable price for uranium in the course of the next three years.

After that time there are mining factors to take into account, in particular Comeco´s Cigar Lake problem may well be sorted and of course other producers will be coming on stream encouraged by the sustained price for the energy metal.

Despite some profit taking in the last two weeks, understandable after a near five year bull run, the prospects for uranium producers and “all things nuclear” remain encouraging and in our opinion (only ours!) is likely to be at least as good a hedge, and possibly even better than gold, if and when stock markets tank as some gurus are forecasting.


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