Uranium Stockpile Held by Bankrupt Bank

The collapse of Lehman Brothers investment bank last September sent shock waves around the financial world and heralded the public awareness of the recession that has continued to worsen.

The media left us in no doubt that the reason for Lehman’s demise was due to the $60 billion of toxic assets held by the 158 year old bank.

Now the news is that Lehman Brothers also held a stockpile of around 450,000 lbs of uranium, the result of a commodities trading contract, gives a whole new slant on the much used expression ‘toxic assets’.In the meantime the price of uranium, often called yellowcake, has dropped from around $65 a lb to as low as $40 a lb. making Lehmans holding worth today $18-$20 million.

It is reported that so far the banks liquidators have failed to sell the stockpile as demand has dropped off due to the global recession.

Although many new nuclear plants are being constructed or are planned around the world, it will be some years before many will come on stream.

In the meantime it is unlikely that any significant uptake in uranium demand in the immediate future will become evident.

Investors in uranium miners should take note of what looks like an over supply situation, at least in the shorter term, and adjust their positions accordingly.

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