Nick Carter of UxC shares details on the uranium market, including supply/demand dynamics and where prices may be headed.
Speaking at the recent Prospectors & Developers Association of Canada (PDAC) convention, Nick Carter of UxC said he expects prices to “trend a little bit higher” in 2019.
However, he said, “it’s really going to depend, because it’s kind of a little bit of a complicated market with Section 232 initiated by two US producers in the interest of national security.”
Under Section 232, the US would require 25 percent of the uranium used by utilities in the country to be supplied domestically. The Department of Commerce is expected to make a decision next month, at which point it would be passed on to the president.
“I think once that’s announced we’ll have a little bit more clarity in terms of where potentially price may be headed and whether there’s a tariff or a quota situation on US uranium,” said Carter.
He added, “it could end up in a bifurcated market, if there’s a quota situation, where you could have a much higher US price than you would a non-US price […] If there’s tariffs obviously [they] could be placed on Kazakh uranium, [or they] could be on Canadian uranium. So that’s something to watch.”
Although Section 232 is still up in the air, Carter did offer a price prediction for 2019, saying that uranium could reach US$33 per pound, “unless, of course, we have a wildcard situation where another mine is potentially shut down.”
He emphasized that investors should exercise caution, saying that prices will likely move upward more slowly than they did after bottoming out at US$18. “I think [prices] still can push up, but it’s going to be much slower growth than what we saw previously,” he concluded.
Watch the video above for more from Carter on uranium supply, demand and pricing. You can also click here to view our PDAC 2019 playlist.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.