Following on from the last post, there is a lot of comment from...

Following on from the last post, there is a lot of comment from those producers in the uranium market that Japan's shutting down of it's reactors has caused U308 spot price to stagnate. It is also argued that spot price is not an accurate means of gauging the true price of U308 as much is bought on term deals, and it takes a lot of uranium to start a reactor, far less to keep it going. But there is good news on that front.

Some reports indicate that there are over 80 new nuclear power reactors expected to be commissioned globally over the next five years, with 61 currently under construction. The current total of new reactors planned or proposed is 491, nine more than pre-Fukushima.

The investment climate should improve as the value of underlying uranium deposits gradually returns to a more reasonable level to reflect longer-term supply and demand dynamics. Schodde explains that, "in the next couple of years spot prices will snap back to closer to a long-term contract price. The catalyst will probably be a realization that the Russian HEU [highly enriched uranium] sales agreement really has come to an end in 2013. This, plus further news on the overall strength of buying by the Chinese in advance of their commissioning of new power stations there."

Junior mining exploration companies will benefit considerably from these improved uranium market prices. Major exploration budgets will increase, with interest and capital investment likely reflecting higher valuations for junior exploration companies and the potential for mergers or industry consolidation