ATCH for a sudden uptick in spot uranium. Storms have knocked out mining and processing in the world's largest uranium miner, Kazakhstan.
That country produces more than a third of the world's uranium needs - and particularly the requirements of China, South Korea, Japan and India.
In addition, the nuclear industry is now watching events in the world's fourth-largest producer, Niger.
The government in Niamey says it wants more revenue from French uranium giant Areva; meanwhile, French troops are preparing to move into Niger to protect those mines should the Mali emergency spill over into its neighbour.
Spot uranium eased slightly at the end of last week, dropping US35c a pound to $US43.65.
BMO Capital Markets in London sent out a flash that Kazakh operations now producing at the rate of 8620 tonnes a year, or about 12 per cent of world supply, could be affected by the Kazakhstan outage.
State nuclear company KazAtomProm's operations were hit by winds of up to 190km/h that knocked out powerlines supplying four operations. The main power transmission line is expected to be out of action for six weeks. Many employees had their housing destroyed by the gales.
Kazakhstan is the world's largest producer, with 2012 output reaching 20,900 tonnes. Next come Canada and Australia.
In Niger, according to Bloomberg, Mines Minister Omar Hamidou Tchiana said he wanted Areva's Somair and Cominak mines to be "more beneficial to the state". The country wants uranium's contribution to the national budget to rise from the present 20 per cent to 30 per cent.
All this is happening as the nuclear industry wonders where its supplies are coming from in future. By 2020, 112 new nuclear power plants are expected to be completed, 94 of those being in Asia and the Middle East. At present, 65 are under construction globally.
Yet by 2025 total supply from existing mines, planned mines and secondary supplies are expected to meet only two-thirds of the projected demand of 136,000 tonnes.
Food for thought
FLOODS in Queensland will be just one more burden for the global food situation.
Peter Strachan at Perth-based StockAnalysis says floods and droughts around the world are storing up trouble and weather events have sent the commodity food price index back above its 2007 highs.
It was the great northern hemisphere drought of 2007 that produced the initial sparks of the Arab Spring. Now the US and Brazil have had unusually dry conditions while Australia and Indonesia have seen floods.
"High food prices will continue to have a destabilising influence on heavily populated regions of the planet where food and water resources are scarce," he writes in the latest client note.
Strachan thinks 2013 will be the year when chickens come home to roost so far as the world food situation is concerned.
"This is unlikely to end well for anyone," he adds.
Argentina's government has now frozen supermarket food prices. In India's Chennai, Ponni rice has risen recently from 900 rupees ($16.30) a bag to as high as 1250 rupees.
Yet the picture remains, at least for now, mixed.
Last month, cocoa and sugar were among the biggest decliners across the commodities spectrum, with only molybdenum among the metals doing worse or as badly. Arabica coffee futures have hit their lowest point in three years.
Meanwhile, the best performer in January was cotton, heading off fast-rising palladium, platinum and nickel. This was due to expectations that Chinese cotton imports would rise - which also speaks to the recent Chinese purchase of Cubbie station, the vast cotton-growing complex in Queensland.
China's thirst for oil
CHINA'S dependence on foreign crude oil keeps growing. The Beijing News reports figures from the National Development and Reform Commission showing the country imported more than 271 million tonnes in 2012, an increase of 7.3 per cent on the previous year. China now depends on imports for 56.4 per cent of its oil, and Beijing has signalled it wants to cap that at 61 per cent.
Meanwhile, as we know, the US is reducing at a fast clip its dependence on imported oil. China is now buying more oil from the Persian Gulf than is the US.
It also explains why Chinese oil giant Sinopec has invested so heavily in Alberta's oil sands - where one of its subsidiaries has just been hit with Canada's biggest ever workplace safety fine. A Canadian court levied a $C1.5 million ($1.45m) penalty after two Chinese workers died when the roof of a metal tank collapsed.
While on oil, JPMorgan's latest commodity wrap has an interesting 2017 projection of production costs. The cheapest is Iraqi conventional crude at under $US20 a barrel.
Saudi Arabia's will be about $US30 a barrel, China's approaching $US40 a barrel, but North American shale oil will cost about $US60 a barrel to pump (down from about $US90 now) while Russia's costs will be approaching $US80 a barrel.
But the real shockers are JPMorgan's 20
BLR Price at posting:
1.6¢ Sentiment: Buy Disclosure: Held
