France's Areva expects higher uranium prices

By Reuters | 23 Jun, 2014, 05.52PM IST

VIENNA: French nuclear group Areva expects uranium prices - under pressure since Japan's Fukushima accident more than three years ago - to rise again, perhaps later this year or next, a company official said on Monday.

"If you have some kind of move upward it can go quite fast," said Isabelle Leboucher, Areva senior vice president, marketing.

The March 2011 meltdown at the Fukushima plant triggered a slump in uranium prices, which have struggled to recover since. The March 2011 meltdown at the Fukushima plant triggered a slump in uranium prices, which have struggled to recover since.

But Leboucher, speaking on the sidelines of a conference on uranium at the headquarters of the United Nations nuclear agency, cited the construction of nuclear power plants as an important factor in expectations for higher uranium prices.

Despite the questionmark Fukushima put over the future of atomic energy, China and other countries in Asia and elsewhere are pressing ahead with nuclear plants, which are fuelled by refined uranium.

"We don't know exactly when, but it will come back (towards) higher prices," Leboucher said. "Of course, I cannot say if it is going to go up in the coming months or maybe next year."

However, there are a lot of uncertainties and "we don't want to bring too much on the market because we don't know how fast this demand will grow", Leboucher added.

The Fukushima accident - caused by an earthquake and tsunami - was the worst such incident since Chernobyl, whose explosion in 1986 sent radioactive dust across much of Europe.

Partly as a result, the International Atomic Energy Agency in 2013 cut its long-term outlook for nuclear energy growth for a third year in a row. The industry could, however, still nearly double its capacity by 2030 due to expansion in Asia, it said.

With uranium prices declining, Leboucher said utilities tended to wait, thinking that they would have better prices in the months ahead. However, "this means also that some will be short of supply, even if some utilities are stockpiling".

Last month, Areva agreed to a reduction in tax breaks and a rise in royalty rates at its uranium mines in Niger, but said the start of production at its giant Imouraren mine would be delayed until prices improve.

"We will wait for market conditions to be there," Leboucher said.

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